2017: Clear results from our long-term effort

The trust capital that Carnegie has tended for many years created the conditions for sustained healthy growth and improved profitability in 2017.

Carnegie’s successes during the year are proof of strength in several aspects. We are continuing to increase profitability in individual business units and across geographies, and particularly in our growth areas. At the same time, we are strengthening the trust within all client groups in Carnegie, where companies, institutional investors and private investors all rank Carnegie highest among all market players. And so, the results not only reflect the initiatives taken during the year, they are an expression of a long term effort in which strategic choices of direction and investments have gradually strengthened our market position.

Our strong impact in 2017 took place under favourable market conditions, with high investor activity in corporate transactions in all Nordic markets. Carnegie was also in prime position to manage the business opportunities created and we have achieved high return on continuous investments in equity sales and research, corporate advisory services and wealth management advisory. This is reflected in multiple ways, including the high percentage of IPOs and ECM transactions in the Nordic market in which we were involved. It has also had positive impact on client activity linked to our equity sales and research services, including in the London and New York operations.

Focus areas in growth
The business areas with the greatest growth potential, including corporate bonds, Private Banking and our ventures in selected segments of the real estate sector, delivered the strongest relative growth during the year.

The corporate bonds business is still developing well and income nearly doubled year-on-year. Likewise, Private Banking operations delivered sustained strong development in 2017, with positive inflow of new clients, record-high income and increased assets under management. In addition to favourable market conditions during the year, performance in the business area should be considered in the light of the actions taken last year towards a more client-oriented organisation and customised offerings.

Carnegie’s ventures in the real estate sector through property syndications have also produced results during the year, from relatively low income levels last year.

Overall, profitability improvements within both geographies and individual business areas during the year advanced diversified growth for Carnegie’s business as a whole in 2017.

Stronger trust capital
Alongside the positive operational trend, client trust was strengthened across the board, among companies, institutions and private individuals. This was expressed in business mandates during the year as well asin several client and market surveys, where Carnegie is ranked as the top market provider in areas including equity analysis, equity sales, corporate advisory services, corporate bonds and private banking. Accordingly, Carnegie can sum up the year with aleading market position in all areas of operations. This is a testament to the expertise, outstanding commitment and client focus of our employees.

Responsibility and transparency
We are building trust not only with regard to our clients, but also through understanding external expectations for responsible conduct based on our position as a leading financial adviser.

Carnegie took further steps during the year to clarify our stance and approach to sustainability and responsibility in relation to the advice we provide to clients, but also from a wider perspective in regards to other stakeholders.

These included more clearly integrating sustainability aspects in company research and asset management. In addition, we are continuing to strengthen our social responsibility in relation to enterprise and entrepreneurship, where annually recurring initiatives like the Entrepreneurs of the Future reflec tour commitment to the emergence and growth of new companies in the market.

Furthermore, Carnegie joined the UN Global Compact in 2017, in support of its international principles relating to human rights, labour law, the environment and anti-corruption. In conjunction with the annual report 2017, we are also initiating application of Global Reporting Initiative (GRI) standards for sustainability reporting. The annual report includes Carnegie’s first sustainability report, in accordance with the standards imposed under the Swedish Annual Accounts Act.

Long-term competitive advantage
Carnegie continued to invest in the business during the year to respond to high business activity and to streamline internal processes.These eminently worthwhile investments will contribute over the long term to strengthening our market position with a competitive advisory services offering to our clients. In addition, the business has committed substantial resources to implementing new regulatory adjustments entering into force in 2018, such as MiFID II. We are well aware that the strong development during the year was achieved under favourable market conditions, but the growth is diversified and we are building client relationships for the long term. Conditions for Carnegie’s continued positive development are good.

Björn Jansson
CEO and President

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