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Comments regarding Finansinspektionen’s assessment of Landshypotek Bank’s use of one of the bank’s valuation methods

Published: 22 juni 2017

Today, Finansinspektionen (the Swedish Financial Supervisory Authority) published an injunction against Landshypotek Bank’s use of one of the bank’s methods for establishing the market values of real property that are not used for residential purposes.

Martin Kihlberg, Acting General Counsel at Landshypotek Bank comments:

“It is surprising that Finansinspektionen has made a reverse turn and decided not to permit this type of sum-of-parts valuation method, which is a recognised method for valuing agricultural properties. The Authority examined and approved the use of simplified market valuations when Landshypotek Bank was granted a licence to issue covered bonds in 2006.  Accordingly, the bank has used this method as one of several valuation methods for ten years without receiving any comments from either Finansinspektionen or the independent monitor,” says Martin Kihlberg.

“This method for individual valuations is only one of several methods applied by the bank to determine the market values of real property. The use of the method is limited in the bank’s credit granting and is used for smaller properties. However, Finansinspektionen’s about-turn and decision to change the preconditions does risk causing difficulties for our operations and for lending to the countryside and agroforestry industries. Changes and amended preconditions always have a greater impact on smaller companies than on the large companies active in the banking market. This may have a consequential impact on the ability of customers to choose between different alternatives and types of banks in the market. We will now analyse Finansinspektionen’s decision,” informs Martin Kihlberg.


According to Finansinspektionens (the Swedish Financial Supervisory Authority) decision, the Bank will be entitled to rectify until the end of December 2018.

For any queries, please contact:

Tomas Uddin, Chief Communications Officer Landshypotek Bank, +46 70 299 24 08

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