 Mikael Sørensen, General Manager Handelsbanken
1. What is your comment to the current financial situation?
“The current financial situation actually consists of two independent incidents. First we have the credit crises, which started with the problems with the sub-prime mortgages in USA and many banks securitization of their assets. This has further escalated to become a liquidity problem and later a capital problem for many financial institutions. The governments and central banks around the world have tried to tackle the problems with various bail-out packages. The second situation is the slow-down in the global economy. The slow-down was already on its way when the credit crises started, but the problems, especially with the lack of liquidity, have probably worsened the situation.”
2. How does the financial situation affect your company?
“We are a bank with very stable finances, low costs and satisfied customers. We have had a positive liquidity and strong capital base ever since the current credit crises started. Because of this we today have the freedom to choose our own destiny. During the last year we have been able open new branches and have even acquired a small bank in Denmark. “
Jan Moberg, Managing Director Bavak Beveiligingsgroep
1. What is your comment to the current financial situation?
“In general it is never positive to be confronted with these facts. It influences all markets in- and directly. On the other hand, we all know that this moment would come sooner or later, anyway. I believe that the market with all involved ingredients will sort it self out one day. ”It is just a matter on time. You have to have “breath & liquidity”.
2. How does the financial situation affect your company?
“As an international Security company we have some markets and outlets which are more affected of the current crises than others, for example Island which is a very important HUB- island between USA and Europe in shipping / cargo, fish-industry and normal trade, have difficult times today. Bavak supply and install ISPS security concepts for the harbours, prisons. We are promised less orders now than in earlier years due to this affect. Having mentioned this, we manufacture heavy security steel products in USA (Road Blockers, Tire Killers, Speedgate, Bollard systems, etc) for launching these on the national market and this affects us less, because of national currency.( dollars versus dollars) The other way around. It seems to be dealing with Russia (and “Old East / New West” countries. They seem to be less affected to our knowledge. One thing is for sure, orders and delivery times are postponed in general.
 Huib de Vries, Marketing Manager Volvo Cars
1.What is your comment to the current financial situation?
“We see a lot of uncertainty in the market and of course also the automotive industry is suffering from that. What we also see is a trend towards smaller cars. But we are lucky the Dutch market is still rather strong, rather stable. In general it is very good to see that EU governments, especially in the North West, taking the right and effective actions, compared with how they’ve been acting in previous crises. I also believe that the elections in US will affect financial situation in a positive way.” 2.How does the financial situation affect your company?
“It affects us on two levels; we face uncertainty in our market to some extent, but our mother company is hit very hard. Of course, this has its effect on us a subsidiary in The Netherlands as well.
We already have done a lot of restructuring in the Netherlands and we are ready to face the future now. Moreover, Volvo has a very strong brand with a very stable and loyal customer base. Therefore, we are less affected by short time fluctuations than some of our competitors.”
 Peter Crafoord, Atradius Collections , Global Marketing Manager
Peter Crafoord refers to Atradius Economic research department for general comments:
World economic activity is slowing rapidly. Economic conditions have deteriorated considerably since September and while the previous baseline scenario was one of a sharp slowdown in economic activity, the current outlook now points towards contraction across a number of major markets – i.e. negative growth. |
After the failure of Lehman Brothers in mid-September a second wave of panic in the global financial system was launched, leading to a serious crunch in global credit markets. Credit conditions have been tight since September last year and the latest developments have led to further tightening. Stock markets plunged across all regions in response to fire-sales of assets and expectations of a steep global recession. House price growth, which lies at the heart of the problems underpinning the credit crisis, has now turned negative also across European markets. Credit spreads has continued to trail higher, further increasing the cost of credit to households and firms. The transmission of the financial turmoil to real economic activity has been direct. Economic activity slowed considerably in the third quarter and unemployment is picking up. Negative expectations dominate the future, where consumer and business confidence is falling sharply amid concerns over the slowdown and contraction in housing markets and fears of rising unemployment. The current expectations of falling growth translate into a significantly worsened insolvency environment for the whole global portfolio. Financing difficulties and a sharp drop in demand has already taken its toll in terms of corporate failures. Insolvencies have started to climb across major markets and given the economic situation this observed trend is expected to accelerate in 2009. Credit quality is also deteriorating among large rated companies, where corporate credit ratings have been demonstrating a negative bias for several quarters. Emerging market risk has risen considerably across all regions. The collapse of the Icelandic banking sector has exposed vulnerabilities in various other banking systems, in particular across Eastern European and CIS countries. Bank fragility in East Europe is high, as in several countries there has been an over-reliance on international syndicated loans to finance domestic credit such as mortgages, corporate loans and consumer credit. If these banks cannot roll over their debt, a significant credit crunch will ensue. These countries include the Ukraine, Azerbaijan and the Baltic States. Given that some of these countries are already in an economic downturn as a result of this previous excessive credit creation, this could have serious consequences for them. We will need to monitor bank risk in these countries carefully. Not because we insure banks, but because of the insolvency risk posed by systemic bank failure. A large number of financial institutions have failed and unprecedented bank bail-out plans by governments in both the US and Europe to escape a full-scale systemic crisis has been implemented. The view of a sharply deteriorating macroeconomic environment, however, holds true regardless of whether government interventions in national banking systems turn out to be successful or not. The perception of credit risk has changed dramatically and the elevated uncertainty will continue to induce friction in financial intermediation. |
