Svenska Handelsbanken AB (publ)

Strong, stable profitability + capital (good): - Q3 2026 operating profit: SEK 7.4bn (+10% QoQ) with ROE 13.5%; cost-to-income 42.3% (improving). - Income up, expenses down: Net interest income and fees improved; expenses down 1% QoQ (down 3% adjusted for currency effects and “Oktogonen” provisions). - Asset quality very strong: credit loss ratio 0 bps in Q3; average quarterly credit losses since 2019 ~SEK 3m (~0 bps), including volatile macro periods. - Capital: CET1 17%; SREP requirement (incl. Pillar 2G) lowered to 14.5% after anticipated dividend; management buffer remains large (~250 bps above requirement, within their 100–300 bps target range).

Dividend outlook (expected, but not a hard promise): - Dividend already anticipated/assumed: For the first 9 months, SEK 8 per share (about 92% of earnings for the period), corresponding to ~SEK 16bn. - Management stance: they don’t steer precisely to 250 bps moment-to-moment; major dividend/capital discussion is later in the year (Q4). Given the strong position, the tone is supportive of healthy dividend in 2026, but final payout depends on the Q4 capital picture and deliberations.

Big capital tailwind in Q4 from PD model approvals (surprising/important): - New PD models approved by Swedish FSA: - Corporate PD implemented in Q3 (removed related Pillar 2 add-on of 14 bps). - Household PD approved; to be implemented in Q4. - Expected net CET1/capital impact: - Management expects Household PD to reduce CET1 requirement by ~SEK 3bn net, driven by both the model effect and removal of ~28 bps Pillar 2 related to the application process plus the model-related requirement changes. - No major other capital drivers expected beyond these.