Stockholm-based Svenska Handelsbanken is one of the world’s most consistently profitable banks, having out-performed the average of its European peer group for 48 years in a row.
Not coincidentally, Handelsbanken is also the world’s most decentralized bank—with local branch teams empowered to think and act like small business owners.
When Handelsbanken meets its goals of a higher return on equity than the average of the other listed Swedish banks, a profit share is paid to a foundation named Oktogonen, which keeps its fund entirely in Handelsbanken shares.
Payment only takes place after retirement, which means that all employees are interested in securing the long-term profitability of the bank.
Oktogonen owns around 10 per cent of Handelsbanken's shares. Handelsbanken put in around 90mil (~7.5k per employee) in 2019. Employees can pull their funds out when they're 60, which is often over $1 million.
To get bigger on the outside, you often need to get smaller on the inside!
Handelsbanken’s goal is to have higher profitability than the average of peer competitors in its home markets.
This goal is mainly to be achieved by the Bank having more satisfied customers and lower costs than its competitors.