Swedbank, has acquired Sparbanken Öresund, a retail bank based in the South of Sweden, in addition to launching a new regional banking subsidiary.

The major Swedish private and institutional bank, Swedbank, has acquired Sparbanken Öresund, a regional retail bank based in the South of Sweden.

Through a simultaneous structural deal, a new regional bank, Sparbanken Skåne, is being formed in which Swedbank will have a 22 per cent ownership.

The deal significantly strengthens the firm’s market position by providing significant growth in the region, through the take over of 16 branches from Sparbanken Öresund.

Furthermore, the firm said it would be opening new branches in the towns of Båstad, Ängelholm and Lomma.

According to the statement, Sparbanken Skåne will be the largest savings bank in Sweden and have an anticipated positive results impact in 2014 of SEK200 million after tax.

The move will cost the firm about SEK650 million, raising its planned expenses for 2014 significantly.

Lars Ljungälv, currently chief executive of Sparbanken Öresund, will be the new head of Swedbank's Southern Region and thereby a member of Swedbank's group executive committee. Stojko Gjurovski, the present head of the region, will continue in parallel for a transition period, the statement added.

In related news, Swedbank recently reported a drop in fourth-quarter net profit as a rising interest income was unable to fully compensate for higher costs in 2013. Assets under management, however, rose sharply. Read more on that story, here.