Carnegie, where knowledge and capital meet, generated increasing returns for allof our client segments in 2016. A positive transaction climate benefited companies and entrepreneurs as well as institutional and private investors. At the same time, there was a growing need for advice due to the political uncertainty that shaped the financial markets during parts of 2016.
Carnegie executed more equity capital market transactions than any other bank in the Nordic market during the year, including participation in 18 out of 25 IPOs, each with a value in excess of USD 40 million. These included the Swedish education group AcadeMedia, Finnish retailer Tokmanni and Norwegian wine and spirits supplier Arcus. The strong impact is consistent with Carnegie’s successful development during a longer period. In the Swedish IPO market alone, we have participated in 41 of 54 transactions in the major market places since 2010.
Improved income mix
We also experienced the strongest relative growth in individual business segments during the year, including advisory services related to mergers and acquisitions as well as corporate bond issues and trading. The favourable development in these strategic growth areas is gratifying. Carnegie participated in notable transactions including the biggest real estate deal in Sweden, through Castellum’s acquisition of Norrporten, and acted as advisor for bond issues from companies including the pharmaceutical company Moberg Pharma and the online gaming company Catena Media.
Our growth is occurring in almost all geographical territories in which we do business and the successes are bolstering the contribution to Carnegie’s total income. As a result, we improved the breadth of the overall income mix during the year.
In addition, we continued to sharpen the value proposition to entrepreneurs and high net worth individuals within our Private Banking business. On the strength of the new management and organisation, the business has received solid recognition during the year with top rankings in both industry and client surveys. That supports the potential of higher gains for Carnegie in the Private Banking market.
Highest client satisfaction in the business
Our collective competence and experience continued to fortify client trust during the year among global and Swedish institutions as well as Nordic companies and Swedish private clients. Carnegie was ranked highest in the market in 2016 in several surveys, in areas including corporate advisory services, wealth management, research capacity, equity sales and placement capacity. Accordingly, a leading position in all areas of operations is the bottom line for the year. That should also be regarded as an expression of our employees’ knowledge, client focus and commitment, which characterise our company culture and shape new business opportunities.
Sharper focus on advisory services
Advisory services have been the foundation of Carnegie’s business and value proposition for a long time. It is based on our knowledge about Nordic companies andtheir market conditions, which is essential input for many investors in the capital market. In parallel, our experience in capital acquisitions plays a central role in the development of high-growth companies. Entrepreneurial companies, in turn, are often founded by enthusiastic promoters who are often found among our wealth management clients. And thus, our advisory services also integrate our client relationships.
Carnegie took several strategic decisions during the year to increase focus on advisory services as the company’s core business including selling Carnegie Fonder, which was finalised during the spring, and exiting third party distribution of structured products.
This has sharpened business focus onour continuing operations and generated greater power to develop and deliver the best advisory services in the business to our clients, in fierce competition.
Carnegie’s long-term success is largely dependent upon the growth of new companies to do business with and for our clients to invest in. The emergence of new companies also drives the overall economy.The more companies that grow and create jobs, the greater the contribution to Sweden’s growth and the Swedish economy.
In other words, a sustainable economy is predicated upon an efficient capital market that facilitates the development and financing of growing companies. Carnegie plays a key role in this context and we have taken definitive steps during the year towards more transparent and active social responsibility, where we are taking advantage of our opportunity to have an influence on sustainable development. The work is continuing and we intend to regularly report our progress in 2017 and thereafter in accordance with the Global Reporting Initiative.
We are grateful to be starting a new financial year with strong client relationships and sustained growth potential. Carnegie has tremendous opportunity to achieve even higher returns on its strong client trust and we have every reason for optimism in 2017.
President and CEO