- known swedish example is the high internet use of both companies and households in their dealings with their banks. swedish banks have also been relatively quick to expand abroad. in relative terms, the swedish banking system is one of the most european banking markets, along with the belgian and dutch systems. however, that only applies to the swedish banking system ’ s “ outward ” europeanization – swedish banks ’ expansion outside sweden. as regards the presence of european banks in the swedish market, ” inward ” europeanization, the swedish banking market is one of the least integrated, beaten even by a “ closed ” market like the italian one. assuming that swedish authorities have not discriminated against foreign players, this pattern could perhaps also be taken as a sign of swedish banks ’ high competitiveness. so it is not all that easy to answer the question of how competitive swedish banks are in an international or european perspective. nevertheless, there is much to suggest that their competitiveness is fairly good. to all appearances the swedish banking system is efficient in its use of resources and it does not seem that this is being achieved through a poorer range of financial services – with possibly the low number of atms as an unusual but striking exception. on the contrary, there are several examples to show that swedish banks ’ service range fares relatively well in an international comparison. on the whole, it appears that swedish banks are organisationally efficient and good at adopting new technologies in their distribution of services, but are less advanced when it comes to developing new products and services. flexibility and long - term competitiveness in the long run, a company ’ s competitiveness is determined by its ability to adapt to changed conditions. how well - positioned are the swedish banks to meet the banking and financial markets of tomorrow? i do not intend here and now to try to predict what the banking market will look like in ten years – that would be doomed to failure. but i would still like to take the chance to reflect on some of the trends that we nonetheless can perceive and what these might entail for swedish banks. here, i would like to highlight two such trends that are somewhat related. the first is disintermediation, which entails that banks ’ role in the loan market is changing from own lending to only providing loans for which another investor assumes the risk. the other trend is commoditization, which means that certain kinds of financial contract – e. g. loans, funds or insurance – are becoming increasingly standardised and difficult to distinguish

from one another. with that, the price should become the crucial factor in the consumer ’ s choice of product. these kinds of trends should be taken with a pinch of salt, of course. changes seldom mean that all previous truths suddenly cease to be valid, and moreover changes do not happen overnight. especially in the banking market, important changes are more likely to occur slowly and gradually over a long period. nonetheless, these trends, even if the impact only proves to be half as big as the financial markets ’ trend oracle predicts, entail interesting challenges and opportunities for swedish banks. together, disintermediation and commoditization should result in a more distinct division of production, distribution and risk - taking. as i am sure you know, this is what consultants call the breaking up of the value chain. even though some banks undoubtedly will try to keep as much of the value chain as 3 / 4 possible, it is going to become more difficult. each part of the value chain will be exposed to competition from specialised niche players. allow me to give a few concrete examples. for several years now it has been noted that swedish banks ’ share of savings is slowly but surely decreasing. not because swedish banks have performed worse than any other pension or fund manager, but simply because there are a lot of players that are at least as good, and sometimes also cheaper. the four major banks have a strong grip on the swedish mortgage market for households. but they seem to have defended their large market shares in some measure through price cuts. also as regards the corporate market, the four major banks appear to have a continued strong position. but this market has grown very weakly and in real terms is smaller today than it was at the start of the 1990s. it is not that the market for company financing has shrunk, but it seems to have scaled back its connections to the major banks. that is partly because large swedish companies can turn to foreign banks or directly to the capital market for funding. also, it is probably partly because swedish banks in the wake of the banking crisis have made a conscious decision to reduce their share of risky lending. however, it does not seem as if the swedish banks have fully managed to compensate for this lower lending through increased advisory services or other ” intermediary services ”. in essence, swedish banks have strong positions in a number of areas but these markets are either mature or else the banks ’ shares are shrinking. if we were to assume that the trend oracle