Good morning and welcome to Swedbank's Q3 2025 Pre-close Call. I'm Maria Caneman and I am Head of Investor Relations here at Swedbank. Joining me from the IR team is Magnus Alvesson. This will be an audio-only team [call]. Please mute yourself during the pre-close call as well as during the subsequent Q&A session unless you're about to ask a question. We would like to start by informing you that the call is being recorded and the script used for this call will be published on the Investor Relations website after the call. This call will focus on events during the third quarter, relevant public data, and macro trends in our markets. We will go through macro indicators, P&L statement, and lastly, comment on capital. We would like to highlight that we will only answer questions relating to already disclosed information as well as publicly available data.
Starting with the macro, there is one day more in this quarter resulting in a positive impact in IR and NCI. On FX movements, as of end of September, the Swedish krona had appreciated from end of June versus the U.S. dollar and the euro. On average, quarter-on- quarter, the krona appreciated against the U.S. dollar and depreciated against the euro. For P&L, the average quarter on quarter development is the relevant number to track. On 23rd of September, the Riksbank announced a reduction of the policy rate by 25 basis points to 1.75% effective on October 1st and indicated no further cuts, which is also the view of Swedbank's macroeconomists that there will be no further changes made to the policy rate during this and next year.
The ECB kept its policy rate unchanged during the quarter and as of end of September, the three-months' IRA decreased on average 17 basis points and the six-months' IRA declined by four basis points on average. Turning to net interest income and reminding you what our CFO said in his analyst call in the second quarter. As we previously talked about regarding timing effects and MII sensitivity, in general, the Swedish loan book takes three months to reprice and the Baltic loan book takes six months. At the same time, the liability side repriced faster. Hence, to conclude, the positive effects from policy rate cuts on the liability side materialized earlier than the negative effects on the asset side. Turning to Sweden, let's start with mortgage lending.
Following the Riksbank policy rate cut announced on 18th of June, we lowered the three-month rate by 25 basis points and 10 basis points of longer fixings on 19th of June. At the end of July, we lowered the list price on one-year fixings by 20 basis points. On 25th of September, we lowered the list price on three-month fixings by another 20 basis points. This information can be found on our website, and I'd like to encourage you to visit this website continuously as we show most of our offerings there. This is where the most up-to-date information is located. If we look at our negotiated prices in Sweden, mortgage rates were down around 30 basis points during the quarter. On deposits in Sweden, we made no rate changes in the third quarter.
However, we lowered deposit rates on the last day of the second quarter by 25 basis points on savings accounts. The rate on private and certain accounts remained at 0% and the rate on e-savings at 0.15% in the quarter. Now turning to mortgage volumes, Statistics Sweden's latest available figure showed that market mortgage volume in August increased by [2.4%], while Swedbank's total volumes declined by 0.1%, including savings bank volume on our balance sheet. Swedbank's total market share was unchanged at 22% at the end of August, of which savings bank volumes on our balance sheet constitute approximately 4 percentage points. Correspondingly, according to Statistics Sweden, the corporate lending in August grew by 2.4% year -on- year, while Swedbank's volumes grew by 4%. Swedbank's market share was unchanged at 15% at the end of August.
Retail deposits in Sweden grew in August by 5.3% year-on-year, while retail deposits in Swedbank increased by 4.8%. Corporate deposits in Sweden in August grew by 4.4% year -on- year, while increasing in Swedbank by 3.2%. As of August, Swedbank's black book market share amounted to 18% for retail deposits and 13% for corporate deposits. Now turning to the Baltics, according to July data from the ECB, total lending in the Baltic countries increased by 12% year-on-year. We had private lending that increased by 11% and corporate lending by 14%. According to the same data from the ECB, the total deposits in the Baltic countries increased by 8% year-on-year, private deposits grew by 11%, and corporate deposits by 3%. Regarding retail deposit rates, during the third quarter, we paid 0% in interest on transaction accounts, unchanged from the second quarter.
The rates on e-saver accounts were lowered by 25 basis points in Estonia and Lithuania in the first week of July, while we kept them unchanged in Latvia. Continuing to net commission income, first of all, a kind reminder that asset management commissions are generated by daily fees. Looking at average values of the stock market development, which impact our asset management fees, the Swedish, U.S., and European stock markets increased by 6.4%, 12.1%, and 3.3% respectively compared to the second quarter. Reminding you of the FX component, where the Swedish krona during the third quarter on average appreciated versus the dollar. You should take this into account when translating the U.S. stock market appreciation. According to statistics from the Swedish Investment Fund Association, the Swedish mutual fund market had a net inflow during July and August. Swedbank's global market share was 21% as of the second quarter of 2025.
Regarding card commissions, card activity in the third quarter is normally seasonally higher than in the previous quarter. Moving on to expenses, please keep in mind the seasonally lower salary costs, primarily in the Baltic countries. Also reminding you of the VAT refund for 2016, the SEK 197 million , which was communicated in conjunction with the Q2 report but received in July, impacting the Q3 cost file. Lastly, a reminder from what our CFO said regarding the full-year cost guidance in the Q2 result call. The cost guidance given for this year is SEK 26.5 billion. Actual costs will be lower due to not at least the VAT recoveries. Temporary investments of SEK 2 billion for 2024 and 2025, they were also somewhat front-loaded with more than SEK 1 billion in 2024. We expect the 2025 level to be around SEK 800 million. Furthermore, due to the strengthening Swedish krona, costs have [audio distortion].
The adjustment stood at SEK 594 million following the release of 129 million. Lastly, on capital, the balance sheet is affected by end-of-period FX rates, mainly coming from RWAs from the Baltics being denominated in euro. As mentioned earlier, at the end of the third quarter, the Swedish krona has strengthened somewhat versus the euro. We assume you've all seen the finance rep decision, which was published and also became effective on 13th of September. The updated CT1 requirement will be included in the end Q3. That was all for the pre-close call. I'll pause for a moment to see if there are any questions. If so, please raise your virtual hand. I can see that we have already. [Magnus Andersson], please go ahead. Magnus, I believe you need to unmute yourself. Please go ahead if you would like to ask a question.
Yeah, there. Now I'm unmuted, right?
Hello, you're with us.
Yeah, okay, thank you. Just regarding the acquisitions you have announced, Stabelo and Entercard, could you please tell us, first of all, when you expect the deals to close? Also, when it comes to Entercard, I guess so that we know when we will have to consolidate it on a gross basis rather than have it as an associated company. Thirdly, when it comes to SB1 Markets, I guess now that we will account for that as profit and loss from associated companies. I'm just wondering how much income and costs disappear from your P&L on the various P&L lines. I understand that it's not much in Q3. It's still a month, I guess, if you started the business in the beginning of September, but more on a quarterly or a yearly basis, just so that we can get the gross and net numbers right.
Absolutely. Starting with the acquisition, Stabelo and Entercard, no closing date has been communicated on either of them. They are pending regulatory confirmations, but it remains our assumption that they will close during the fourth quarter. As soon as we have a formal closing date, we will communicate them, of course. We continue to assume during the fourth quarter. On SB1 Markets, that launched on 1st of September, as we said. As per that date, that is one month after Q3, it will be included as other income. It is very small numbers, of course, only one month. We can get back to you on how to get the full quarter in. For Q3, it will be a very minor effect.
Okay. Thank you. Thank you. Do you have anything new about these VAT recoveries for 2019 to 2023 that were mentioned in conjunction with the Q2 report?
No, no.
It's only another billion.
Yeah, no news, unfortunately, from what we said in the Q2 report. We have submitted the applications. We will get back to you when we have anything to tell you.
Okay, thank you.
Do we have any other hands raised? It doesn't seem like it. Thank you for dialing in. Please note, we will go into the silent period on 9th of October. Our Q3 report will be released on Thursday, the 23rd of October, at 7:00 A.M. CET. Have a good day, everyone.