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Irish Examiner
2 days ago
- Business
- Irish Examiner
EU looks to Sweden as model for investment
The European Union wants to unleash trillions of euro in household savings by encouraging people to invest in capital markets, and it sees Sweden as the template. Europe will soon detail its plan to mobilise citizen funds sitting in bank deposits as part of its savings and investment union. By making it easier for people to invest, it wants to lift household wealth and boost firms' access to funding. According to the Central Bank of Ireland, Irish people have a combined €165.8bn in household deposit savings as of the end of June. Wider adoption of Swedish-style bank accounts would enable people to easily invest savings in stocks. Poland, earlier this month, proposed an investment savings account modelled on Sweden's InvesteringsSparKonto, or ISK system, to create an 'equity culture' attracting the equivalent of €23bn in its first three years. Sweden's retail-trading base is 'among the best in the world' due to the ease with which people have been able to invest in listed companies, Avanza Bank Holding AB savings economist Philip Scholtzé said. The Nordic nation is regarded as a 'best practice' model, said a spokesperson for the financial services department at the European Commission. The bloc aims to provide citizens with 'a wider range of tools and knowledge to invest their savings in ways that can directly benefit their personal economy, while simultaneously turbo-charging the investment landscape in the EU'. National sport Equity investing is akin to a national sport in Sweden. Households invest more than half of their savings in stocks, more than twice the average in the eurozone, according to a report by the European Savings Institute this year. Anyone with a bank account can trade, while the ISK account is not subject to capital gains tax. Securities can be easily bought and sold directly from mobile banking applications. 'Swedes have good reason to be thankful for the ISK account,' said Mohammed Salih, a 32-year-old communications manager who lives in Listerby, Sweden. He has invested with the system for 10 years. I have always saved money and tried to build an economically stable future, but I didn't know how to make the money grow He started an Instagram account to document his journey toward assets equivalent to €90,000. He says he achieved it a few years ago, but still posts stock market tips that attract interest. 'The youngest person who has written to me was 13 years old. His parents had helped him set up an ISK account,' Mr Salih said. The ISK simplified the tax structure around capital investments, removing bureaucratic barriers that had discouraged participation. 'It's just a much simpler way to buy stocks,' Frida Bratt, the savings economist at Nordnet Bank AB, said. 'This has been especially important for young people.' Mutual funds A quarter of Swedes own shares in publicly listed companies, with stakes totalling around €48,000 on average, according to Euroclear Sweden. The Swedish Investment Fund Association shows that 70% of Swedes invest in mutual funds. It remains to be seen what effect the introduction of an EU-wide savings and investment account could have on the wider European market. According to Jonas Strom, the chief executive of the Nordic investment bank ABG Sundal Collier Holding ASA, it is 'definitely possible' to export the Swedish success with the ISK accounts to a wider European audience. The European Commission would only offer a blueprint of how an EU-wide savings and investment account could be constructed, leaving member states to implement it. The success of the proposal depends on the 'political will' of the member states. Bloomberg
Local Sweden
08-04-2025
- Business
- Local Sweden
How are Swedes reacting to the stock market turbulence?
Many Swedes have savings in funds or stocks, and are reacting to the fall in the stock market by moving their savings. Advertisement "We can see a lot of small savers moving to funds with a lower risk, most of all fixed income funds," said Philip Scholtzé from investment platform Avanza. "Interest has increased for long-term and short-term fixed income funds." A lot of savers also chose to sell their funds last month when the markets started to drop. "People sold high risk funds, usually pure stock funds with a global focus. Many of them are American with a tech focus." Frida Bratt, an economist at investment platform Nordnet, said that there was a clear increase in people buying funds based in Europe. "For the first time we're seeing European funds increase. Europe has been out in the cold for a long time, but we're seeing trends change as to where people are putting their money," she said. READ ALSO: Advertisement European stocks, like defence companies and banks, have also risen, while many investors have sold their American stocks. "Lots of people have sold their shares in Coca-Cola, which has remained relatively stable. Coca-Cola is a strong American symbol and people getting rid of their stocks could have something to do with them just not wanting to be linked to the US," Bratt said.
