HANDELSBANKEN Harvard Case Solution & Analysis



Handelsbanken is national bank in Swedish which offer its services over 200 branches and most of the branches take hold by acquisitions. It was profitable bank enjoys potential growth from decades and is considering about to open new branches in abroad for expanding its business internationally.

The options available to Handelsbanken includes three options it can grown in neighbor countries where it can offer full of banking services second option available in UK market with full range of banking services where the opportunities to increase large market share by offering new advance and satisfied services to market and third option is to make investment in Baltic states in order to overcome the crisis situation which the bank is currently facing.

Problem statement:

Handelsbanken faces loan losses during financial crush and opportunities might be limited for further growth despite of the high potential and highly competitive market availability.

Resource analysis:

Human capital Capable Staffs, management.
Financial Improving Credit loans, strong ROE  (after tax)
Organizational Wide range of customers,


Over viewing of resource analysis banks have varieties of resources available such as capable staff and good management.

Financial position showing by comparing with Swedish bank in region bank is taking control over its credit loans problem because bank change its policies in wide range

Financial analysis:

Profitability margin:

Profit margin is continuously increasing so market has potential to increase profitability in future because bank’s revenue is generating good profit margin and by adopting any of alternative bank can make profit as revenue turn into profit. That means bank has significant financial strength to expand in global market.

Operating profitability margin:

Operating profit margin indicate the how is facing its cost and how much profit is available to meet its daily expenditure so operating profit is increasing showing much ability of bank which can meet by good ability of its daily expenditure. The operating profit ratio of the company is increasing continuously which is a good sign for the future growth strategies.

Expenses ratio:

Expenses ratio indicating the relationship between expenses with its sale so as the ratio is lowering which is good indication that bank would be able to lower it expenses and take better control over its expense so ratio is lower would be more profitability.

Cash ratio:

Cash ratio indicating how much cash is available to meet with it liabilities so as the ratio is negative showing very low  availability of cash to meet its expenditure bank may facing higher liabilities which makes ratio very low.

Assets turnover:

Assets turn over indicating the ability of making profit by utilizing of its total assets, Assets turnover of bank is higher as so it would be much potential in market that bank would make higher profit the assets available so, the ratio is on increasing trend.

Debt ratio:

Debt ratio showing how much bank rely on debt financing, the leverage ratio is high which means bank is more relying on debt financing as ratio is much higher further it would financial risk as the debt financing is high so this might be hurdle in order to achieve its future objectives.

Return on equity:

Return on equity indicating how much bank getting income from its shareholder equity ratio and it is stable showing earnings from share holder’s investment. If bank go for any of alternative bank need to maximize its share holder’s wealth in order to attract equity investors to meet the future funds need for growth plans.



Through our analysis we have extracted the facts that Handelsbanken had a threat of new entrant in the market that may be not now, but in later times which may take the hold of the market share which they had attained after many hardships and policy reforming. The threat of new entrant increased in Sweden as the government suddenly in late 60’s lower the barriers to enter into new markets which on one hand proved to be beneficial for the Handelsbanken but with that I brought the threats of new businesses entering to the Sweden market.....................

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