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Economy and Banking Sector of Sweden

Sweden
Location
Northern Europe
Population  (2017)
9 995 153  (+0.01%)
EU Status
member since 1995
Currency
SEK (Swedish krona/kronor)
Nominal GDP (2016)
462.4 bln EUR  (+0.04%)
Credit Ratings (as of Sep 2016)
AAA/Aaa
Consolidated Banking Assets (2016)
1 593.41 bln EUR  (-1.79%)
Deposit Guarantee
100 000 EUR
Number of Banks
163

Sweden (officially the Kingdom of Sweden) is a prosperous, democratic country in Northern Europe with a high standard of living, a low level of corruption, and a high level of education and health care.

Swedish economy is characterised by a large, knowledge-intensive and export-oriented manufacturing sector; an increasing, but still small, business service sector. Main industries of Swedish economy are iron and steel, precision equipment, wood pulp and paper products, processed foods, motor vehicles.

Swedish banking sector is dominated by "Big Four" domestic banks, operating as universal banks. There are also a number of foreign-controlled banks, and regional savings banks. The "Big Four" Swedish banks have prominent presence in other Scandinavian Countries and Baltic States.

List of Banks in Sweden

National Currency

Swedish Krona/kronor (SEK)

Exchange Rate

1 EUR = 10.016 SEK (2017-12-11)

During the last 11 years EURSEK exchange rate was within the range 8.3362 - 11.4524, reaching its maximum in Feb 2009 and falling to its minimum in Aug 2012.

Euro to Swedish krona/kronor (EURSEK).

Chart 1. Euro to Swedish krona/kronor (EURSEK). Source: ECB.

GDP

Nominal GDP (2016)Nominal GDP per Capita (2016)Real GDP Growth (2016)
462.4 bln EUR  (+0.04%)46 600 EUR  (+0.03%)3.3 %  (2015: 4.1 %)

According to Eurostat, nominal GDP of Sweden in 2016 was 462.4 bln EUR.

Sweden outperforms the European Union in terms of real GDP growth with the average annual differential coming to 0.7% over the past 10 years (2006 - 2016). In 2016 real GDP growth was 3.3% which was above the Euro Area average (1.8%) and above the European Union average (1.9%). Real GDP growth in 2017 - 2022 are IMF's estimates.

Real GDP Growth in Sweden.

Chart 2. Real GDP Growth in Sweden. Source: Eurostat, International Monetary Fund.

In 2016, nominal GDP per capita in Sweden was 46 600 EUR.

Sweden has an above-average level of wealth in terms of per-capita GDP at purchasing power parity (PPP); this economic welfare indicator has, on average, exceeded that of the European Union by 21.7% over the past 10 years (2006 - 2016). GDP per capita at PPP in 2017 - 2022 are IMF's estimates.

GDP Per Capita at Purchasing Power Parity in  Sweden; European Union = 100.

Chart 3. GDP Per Capita at Purchasing Power Parity in Sweden; European Union = 100.

Inflation Rate

CPI, MoM (Sep 2017)CPI, YoY (Sep 2017)CPI, Year Average (2016)
0.1 %  (Aug 2017: -0.2 %)2.2 % (unchanged)1.1 %  (2015: 0.7 %)

According to Eurostat, inflation rate in Sweden in 2016 expressed as annual percentages of average consumer prices was 1.1% which was above the Euro Area average (0.2%) and above the European Union average (0.3%). Inflation rates in 2017 - 2022 are IMF's estimates.

Inflation Rate in Sweden.

Chart 4. Inflation Rate in Sweden. Source: Eurostat, International Monetary Fund.

Unemployment Rate

Unemployment Rate (2016)
6.9 %  (2015: 7.4 %)

Government Bond Yield

Government Bond Yield (Sep 2017)
0.62 %  (Aug 2017: 0.63 %)
According to Eurostat, government bond yield in Sweden in Sep 2017 was 0.62%, compared to 0.63% in Aug 2017.
Government bond yield of Sweden.

Chart 5. Government bond yield of Sweden. Source: Eurostat.

Credit Ratings (as of Sep 2016)

Fitch Moody's
AAA (highest credit quality), outlook stable Aaa (prime), outlook stable

Withholding Tax

Withholding taxes are imposed at source of income and are often applied to dividends, interest, royalties, rent and similar payments. The rates of withholding tax are often reduced by double taxation agreements.

Withholding Tax Rates in Sweden: 0.0 - 30.0%

Withholding tax rates applied on payments of interest and dividends in Sweden are shown in Table 1.

Dividends Interest
Natural person, resident 30.0 %30.0 %
Natural person, non-resident 30.0 %0.0 %
Table 1. Withholding tax rates in Sweden.

Double Taxation Agreements

Double Taxation Agreement (DTA) is an agreement between two or more countries for the avoidance of double taxation.

DTAs of Sweden: 77 Signed Agreements

Sweden signed DTAs which already came info force with the following jurisdictions (for agreements which came into force after 1 January 2013 the date of coming into force is given in brackets):

 Albania
 Antigua and Barbuda
 Argentina
 Australia
 Austria
 Azerbaijan
 Bangladesh
 Barbados
 Belarus
 Belgium
 Bolivia
 Bosnia and Herzegovina
 Botswana
 Brazil
 Bulgaria
 Canada
 Chile
 China
 Croatia
 Cyprus
 Czech Republic
 Egypt
 Estonia
 France
 Gambia
 Germany
 Greece
 Hungary
 India
 Indonesia
 Ireland
 Israel
 Italy
 Jamaica
 Japan
 Kazakhstan
 Kenya
 Korea, Republic of
 Latvia
 Lithuania
 Luxembourg
 Macedonia
 Malaysia
 Malta
 Mauritius
 Mexico
 Montenegro
 Namibia
 Netherlands
 New Zealand
 Pakistan
 Philippines
 Poland
 Portugal
 Romania
 Russian Federation
 Serbia
 Singapore
 Slovakia
 Slovenia
 South Africa
 Spain
 Sri Lanka
 Switzerland
 Tanzania, United Republic of
 Thailand
 Trinidad and Tobago
 Tunisia
 Turkey
 Ukraine
 United Kingdom
 United States
 Venezuela
 Vietnam
 Zambia
 Zimbabwe

There are also several agreements between Sweden and other jurisdictions which were signed but haven't yet come into force (for agreements signed after after 1 January 2013 of signing the agreement is given in brackets):

 Nigeria

Information Exchange

There are 3 ways for jusrisdictions to exchange information on tax matters:

  • spontaneously;
  • on request;
  • automatically.

Spontaneous exchange of information is provision of information that is forseeably relevant to another party without a request being previously sent.

Tax Information Exchange Agreements (TIEAs) enable exchange of information on request relating to a specific tax investigation, either criminal or civil.

Automatic information exchange allows jurisdictions to exchange information automatically, without having a specific tax investigation.

Exchange on Request: 46 Signed Agreements

Sweden signed TIEAs which already came info force with the following jurisdictions (for agreements which came into force after 1 January 2013 the date of coming into force is given in brackets):

 Andorra
 Anguilla
 Antigua and Barbuda (Jun 2013)
 Aruba
 Bahamas
 Bermuda
 British Virgin Islands
 Cayman Islands
 Cook Islands
 Curacao
 Denmark
 Faroe Islands
 Finland
 Gibraltar
 Greenland
 Guernsey
 Iceland
 Isle of Man
 Jersey
 Liberia
 Liechtenstein
 Monaco
 Norway
 Panama (Dec 2013)
 Saint Kitts and Nevis
 Saint Lucia (Aug 2013)
 Saint Vincent and The Grenadines
 Samoa
 San Marino
 Sint Maarten (Dutch part)
 Turks and Caicos Islands

There are also several agreements between Sweden and other jurisdictions which was signed but haven't yet come into force (for agreements signed after 1 January 2013 of signing the agreement is given in brackets):

 Bahrain
 Belize
 Brunei Darussalam
 Costa Rica
 Dominica
 Grenada
 Guatemala
 Macau
 Marshall Islands
 Montserrat
 Niue (Oct 2013)
 Qatar (Sep 2013)
 Seychelles
 Uruguay
 Vanuatu

Automatic Exchange: Starts in September 2017

Sweden signed the automatic information exchange agreement on 29 October 2014 and committed to start the automatic information exchange in September 2017.

Automatic Excnange: 56 Bilateral Agreements to Receive Information

Sweden has signed bilateral agreements with 56 jurisdictions to automatically receive information:

 Andorra
 Argentina
 Australia
 Austria
 Belgium
 Brazil
 Bulgaria
 Canada
 China
 Colombia
 Croatia
 Cyprus
 Czech Republic
 Denmark
 Estonia
 Faroe Islands
 Finland
 France
 Germany
 Gibraltar
 Greece
 Greenland
 Guernsey
 Hungary
 Iceland
 India
 Ireland
 Isle of Man
 Italy
 Japan
 Jersey
 Korea, Republic of
 Latvia
 Liechtenstein
 Lithuania
 Luxembourg
 Malaysia
 Malta
 Mauritius
 Mexico
 Monaco
 Netherlands
 New Zealand
 Norway
 Poland
 Portugal
 Romania
 San Marino
 Seychelles
 Slovakia
 Slovenia
 South Africa
 Spain
 Switzerland
 United Kingdom
 Uruguay

Automatic Excnange: 68 Bilateral Agreements to Send Information

Sweden has signed bilateral agreements with 68 jurisdictions to automatically send information:

 Andorra
 Anguilla
 Argentina
 Australia
 Austria
 Belgium
 Belize
 Bermuda
 Brazil
 British Virgin Islands
 Bulgaria
 Canada
 Cayman Islands
 China
 Colombia
 Costa Rica
 Croatia
 Cyprus
 Czech Republic
 Denmark
 Estonia
 Faroe Islands
 Finland
 France
 Germany
 Gibraltar
 Greece
 Greenland
 Guernsey
 Hungary
 Iceland
 India
 Indonesia
 Ireland
 Isle of Man
 Italy
 Japan
 Jersey
 Korea, Republic of
 Latvia
 Liechtenstein
 Lithuania
 Luxembourg
 Malaysia
 Malta
 Mauritius
 Mexico
 Monaco
 Montserrat
 Netherlands
 New Zealand
 Norway
 Poland
 Portugal
 Romania
 Saint Lucia
 Saint Vincent and The Grenadines
 Samoa
 San Marino
 Seychelles
 Slovakia
 Slovenia
 South Africa
 Spain
 Switzerland
 Turks and Caicos Islands
 United Kingdom
 Uruguay

Further Information

FATCA

Foreign Account Tax Compliance Act (FATCA) which became law in the United States in March 2010, focuses on reporting made by foreign financial institutions about financial accounts held by US taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest. The FATCA-reporting is facilitated by Intergovernmental Agreements (IGAs).

FATCA Status in Sweden
IGA in effect since 08 August 2014, Model 1

Sweden has FATCA agreement with the U.S. in effect since 08 August 2014 (Intergovernmental Agreement Model 1). Financial institutions operating in Sweden are required to identify U.S. taxpayers by January 1, 2017 and to report the information for 2017 and the subsequent years. The agreement is reciprocal: Swedish financial accounts hold in U.S. financial institutions will be reported to Swedish authorities.

Further Information

Financial Market Development

Financial Market Development
5.1 (max 7.0), 10th out of 138 countries
Banks' Soundness
5.8 (max 7.0), 19th out of 138 countries

According to World Economic Forum's Global Competitiveness Report 2017-2018, financial market development in Sweden is scored 5.1 out of maximum 7.0 and ranked 10th out of 138 analysed economies, trustworthiness and confidence of financial market is scored 5.2 (22nd place).

Financial Market Development in Sweden.

Chart 6. Financial Market Development in Sweden. Source: WEF.


Soundness of banks is scored 5.8 bringing Sweden into the 19th place.

Soundness of Banks in Sweden.

Chart 7. Soundness of Banks in Sweden. Source: WEF.

Further Information

Deposit Guarantee Scheme

Maximum Protected Amount
100 000 EUR

Deposit Guarantee Schemes compensate certain deposits held by depositors of a bank that becomes unable to meet its obligations.

From a depositor's point of view it is important to know:

  • if the depositor is eligible within the terms of the deposit guarantee scheme;
  • if the depositor's bank is a participant in the deposit guarantee scheme;
  • if the depositor's type of deposit is covered by the deposit guarantee scheme.

All these details about deposit guarantee scheme in Sweden are summarised in Table 2.

Scheme Participantsall credit institutions operating in Sweden, branches of Swedish banks abroad
Scheme Exemptionsbranches of foreign banks (covered by their home countries)
Eligible Depositorsprivate individuals, companies and other legal entities
Covered Accountsdeposits in all types of accounts
Maximum Protected Amount100 000 EUR
Paid In CurrencyEUR

Table 2. Deposit guarantee scheme in Sweden.

Further Information

Country Ceiling for Deposits

Moody's country ceilings for deposits specify the highest rating that can be assigned to local- or foreign- currency denominated deposit obligations of a bank or other deposit taking institution domiciled within that country.

Local Currency (Swedish krona/kronor) Foreign Currency
Aaa (prime) Aaa (prime)

Local currency (Swedish krona/kronor) deposit ceiling for Sweden is set to Aaa (prime), foreign currency deposit ceiling is Aaa (prime).

Deposit Rates

Average Deposit Rate (Aug 2017, SEK)
0.08 %  (Jul 2017: 0.07 %)
In Aug 2017, an agreed annualised deposit rate in local currency (Swedish krona/kronor) of new contracts with agreed maturity up to 1 year between credit institutions and households was 0.08%.
Deposit Rates in Sweden.

Chart 8. Deposit Rates in Sweden. Source: ECB.

Further Information

Banking Sector Structure

Number of Banks
163
Consolidated Assets (2016)
1 593.41 bln EUR  (-1.79%)
Recent Changes (2016)
new banks: 1, closed banks: 1

Currently there are 163 credit institutions operating in Sweden.

In 2016 consolidated banking assets in Sweden were 1 593.41 bln EUR. The consolidated banking assets' evolution is shown at Chart 9 below.

Consolidated banking assets in Sweden.

Chart 9. Consolidated banking assets in Sweden.

Recent structural changes (2013 - 2016) of the banking sector of Sweden are summarised in Table 3.

2013201420152016
Number of Opened Banks0711
Number of Closed Banks11151

Table 3. Recent structural changes in the banking sector of Sweden.

The list of the most recently opened banks in Sweden is provided in Table 4.

NameStart Date
 Ecster AB (new)June 2016
 Lån & Spar Sverige, bankfilial (new)November 2015
Aros Kapital AB (new)December 2014
 UBS (Luxembourg) S.A. Sweden Bankfilial (closed)December 2014
 Bank of China (Luxembourg) S.A. Stockholm filial (new)August 2014
 Credit Suisse International,(UK)Bank Sweden Branch (filial) (new)August 2014
 Ålandsbanken Abp(Finland),svensk filial (new)August 2014
 Barclays Bank PLC Filial Stockholm (new)June 2014
 Söderberg och Partners Placeringsrådgivning AB (closed)March 2014
 

Table 4. The most recently opened banks in Sweden.

All the credit institutions operating in Sweden can be classified into several categories. Table 5 summarises the number of banks in each category.

CategoryNumber of Banks
Banks72
Branches of foreign banks30
Central banks1
Member banks2
Savings banks58

Table 5. Number of banks by category in Sweden.

There are 31 branches of foreign banks from 9 different countries in Sweden. Table 6 shows the number of branches grouped by the country of origin.

Country of OriginNumber of Branches
 United Kingdom10
 Norway5
 Germany5
 France3
 Denmark2
 Finland2
 Luxembourg2
 Estonia1
 Belgium1

Table 6. Number of branches of foreign banks in Sweden grouped by country of origin.

Savings Accounts

Minimal Interest Rate
0.50 %
Maximum Interest Rate
0.60 %
15 offers from 3 banks

Time Deposit Accounts

Minimal Interest Rate
0.70 %
Maximum Interest Rate
1.10 %
8 offers from 3 banks