Traditional Banks - Sweden

Sweden

In 2024, it is projected that the Net Interest Income in the Traditional Banks market market in Sweden will reach US$42.14bn.
Traditional Retail Banking dominates the market with a projected market volume of US$24.44bn in the same year.
Looking ahead, the Net Interest Income is expected to show an annual growth rate (CAGR 2024-2028) of 2.79%, resulting in a market volume of US$47.04bn by 2028.
When compared globally, it is worth noting that in China will generate the highest Net Interest Income, amounting to US$4,690.0bn in 2024.
Sweden's traditional banks are embracing digital transformation to cater to the tech-savvy and mobile-first population.

Key regions: Singapore, United Kingdom, Germany, Brazil, United States

Definition:

The Traditional Retail and Commercial Banks market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.
The traditional banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. These banks have a long history of serving customers and have established relationships and a deep understanding of the financial needs of their communities. They offer a wide range of services and are able to provide personalized advice and support to their customers.
In this market, banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. However, they also face challenges, such as increased competition and changing customer preferences, which are driving the need for continuous improvement and adaptation.
Overall, the traditional retail and commercial banking market provides a wide range of financial services to both individuals and businesses through established, trusted channels and continues to play a vital role in the financial landscape.

Structure:

The market consists of two segments:
- The Traditional Retail Banks market refers to financial services provided to individual consumers (e.g., personal loans, savings and checking accounts, credit cards, mortgages).
- The Traditional Commercial Banks market refers to financial services provided to businesses, including small and large enterprises (loans, lines of credit, other financial products specifically designed for businesses).

The market data comprises Net Interest Income, the value of Deposits, the value of Loans, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the retail and commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.

Key players in this market are companies such as Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

Sweden's Traditional Banks market is experiencing a shift in customer preferences, trends, and local special circumstances, driven by underlying macroeconomic factors.

Customer preferences: Customers in Sweden are increasingly gravitating towards digital banking services, favoring convenience, accessibility, and efficiency. This shift is fueled by the tech-savvy population and the growing acceptance of online banking solutions. As a result, traditional banks in Sweden are adapting their strategies to meet the evolving needs of customers, focusing on enhancing their digital offerings and customer experience.

Trends in the market: One prominent trend in the Traditional Banks market in Sweden is the rise of sustainable banking practices. Swedish consumers are showing a strong preference for banks that prioritize environmental and social responsibility in their operations. This trend is influencing the product offerings and marketing strategies of traditional banks, pushing them towards more sustainable and ethical practices. Another key trend is the increasing competition from digital-only banks and fintech companies. These new entrants are disrupting the market with innovative solutions, lower fees, and superior customer experiences. Traditional banks in Sweden are facing pressure to innovate and differentiate themselves to stay competitive in this rapidly evolving landscape.

Local special circumstances: Sweden's unique regulatory environment, characterized by strict compliance requirements and a strong emphasis on consumer protection, is shaping the Traditional Banks market in the country. Traditional banks need to navigate complex regulatory frameworks while ensuring transparency and trust with their customers. This regulatory landscape influences the development of new products and services, as banks strive to meet regulatory standards while staying competitive in the market.

Underlying macroeconomic factors: The macroeconomic environment in Sweden, including factors such as interest rates, economic growth, and inflation, plays a significant role in shaping the Traditional Banks market. Low interest rates and a stable economy have led to increased borrowing and investment activities, driving demand for banking services. At the same time, economic uncertainties and changing consumer behaviors are prompting traditional banks to reassess their business models and strategies to remain resilient in the face of evolving market conditions.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.