Fitch puts Swedbank on negative watch

Fitch Ratings said it placed Swedbank AB's AA- long-term and F1+ short-term issuer default ratings on Rating Watch negative.

The bank's AA- viability rating and all debt ratings were placed on Rating Watch negative.

The ratings reflect a view that the ongoing allegations of its potential involvement in money laundering through its Baltic operations, and specifically Estonia, have revealed weaknesses in the bank's management, which could ultimately affect its franchise, Fitch explained.

The negative watch also reflects uncertainty over the bank's management of operational and reputational risks, which might no longer be in line with the bank's high rating, the agency said.

The ratings also consider the bank's ability to generate stable revenue from its low-risk core business and maintain best-in-class cost-efficiency and strong asset quality, Fitch said.

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