SEB Fund 2 Draft final updated · Organisation 3 Management Company: SEB Investment Management AB...
Transcript of SEB Fund 2 Draft final updated · Organisation 3 Management Company: SEB Investment Management AB...
R.C. S K 50
Annual Report SEB Fund 2
Status: 31 December 2017
Notice
The sole legally binding basis for the purchase of units of
the Fund described in this report is the latest valid Sales Prospectus with its terms of contract.
Table of Contents
1
Page
Additional Information to the Investors in Germany 2
Organisation 3
General Information 5
Management Report 7
Schedule of Investments:
SEB Fund 2 - SEB Asia ex. Japan Fund 9
SEB Fund 2 - SEB Generation Fund 80 14
SEB Fund 2 - SEB Nordic Focus Fund 16
SEB Fund 2 - SEB Russia Fund 18
Combined Statement of Operations 21
Combined Statement of Changes in Net Assets 23
Combined Statement of Net Assets 25
Statistical Information 27
Additional Information on Management Fees Paid 30
Notes to the Financial Statements 31
Audit Report 35
Risk Disclosure (unaudited) 38
Remuneration Disclosure (unaudited) 40
Additional Information to the Investors in Germany
As at 31 December 2017
2
Units in circulation:
The following Sub-Fund is publicly approved for distribution in Germany:
• SEB Fund 2 - SEB Russia Fund
The following Sub-Funds are not distributed in Germany:
• SEB Fund 2 - SEB Asia ex. Japan Fund
• SEB Fund 2 - SEB Generation Fund 80
• SEB Fund 2 - SEB Nordic Focus Fund
The information disclosed above is as at 31 December 2017 and this may change after the year end. The current Sub-Fund in
circulation and the current registrations per unit class are visible in the distribution matrix on www.sebgroup.lu.
Organisation
3
Management Company: SEB Investment Management AB Stjärntorget 4 SE-169 79 Solna, Sweden
Board of Directors of
the Management Company:
Chairperson
Johan Wigh Advokat, Törngren Magnell Sandemarsvägen 18 122 60 Enskede Sweden
Members
Magnus Wallberg Chief Financial Officer Life and Investment Management Division Skandinaviska Enskilda Banken AB (publ) Sweden
Karin S. Thorburn Professor in Finance at the Norwegian School of Economics Starefossveien 58 A 5019 Bergen, Norway
Jenny Askfelt Ruud (since 18 May 2017) Advisor Ratos AB Äppelviksv 5 167 53 Bromma Sweden
Branch of the Management Company: SEB Investment Management AB, Luxembourg Branch 4, rue Peternelchen L-2370 Howald, Luxembourg
Central Administration (including the
administrative, registrar and transfer
agent function) and Paying Agent in
Luxembourg:
The Bank of New York Mellon SA/NV, Luxembourg Branch 2-4, rue Eugène Ruppert L-2453 Luxembourg
Investment Managers: SEB Fund 2 - SEB Asia ex. Japan Fund
SEB Fund 2 - SEB Generation Fund 80
SEB Fund 2 - SEB Nordic Focus Fund
SEB Investment Management AB Stjärntorget 4 SE-169 79 Solna, Sweden
SEB Fund 2 - SEB Russia Fund
AS SEB Varahaldus Tornimäe 2 EE-15010 Tallinn, Estonia
Organisation
4
Sub-Investment Managers: SEB Fund 2 - SEB Nordic Focus Fund
Skandinaviska Enskilda Banken Danmark, Bernstoffsgade 50, DK-1577 Copenhagen V, Denmark
SEB Wealth Management Finland Ltd. Unioninkatu 30 00100 Helsinki, Finland
Depositary: Skandinaviska Enskilda Banken S.A. 4, rue Peternelchen L-2370 Howald, Luxembourg
Auditor of the Fund:
PricewaterhouseCoopers, Société coopérative 2, rue Gerhard Mercator L-2182 Luxembourg
Auditor of the Management Company: PricewaterhouseCoopers AB Torsgatan 21 SE-113 97 Stockholm, Sweden
Global Distributor: Skandinaviska Enskilda Banken AB (publ) Kungsträdgårdsgatan 8 SE-106 40 Stockholm, Sweden
Representatives and Paying
Agents outside Luxembourg: The full list of representatives and paying agents outside Luxembourg can be obtained,
free of any charge, at the address of the Management Company, at the address of the
Branch and on the website of the Branch.
General Information
5
SEB Fund 2 is an open-ended common fund ("FCP" - "Fonds Commun de Placement") governed by Part I of the Luxembourg
Law on Undertakings for Collective Investment of 17 December 2010, as amended, (the “Law”). The Fund qualifies as an Undertaking for Collective Investment in Transferable Securities (UCITS). The Fund was set up on 21 April 1986 for an undetermined duration. The Management Regulations lastly modified with effect from 20 September 2017, have been
published in the Recueil Electronique des Sociétés et Associations (RESA) on 2 November 2017. The Fund is registered in
Luxembourg at the Luxembourg Register of Commerce under the number K 50. The Management Company was established on 19 May 1978 in the form of a Swedish limited liability company (AB). The Management Company is authorised by
Finansinspektionen for the management of UCITS and for the discretionary management of financial instruments and
investment portfolios under the Swedish UCITS Act (SFS 2004:46). The Management Company is also authorised as an alternative investment fund manager to manage alternative investment funds under the Swedish AIFM Act (SFS 2013:561).
The Management Company has delegated parts of the Central Administration as further detailed hereafter, including the administrative, registrar and transfer agent functions - under its continued responsibility and control - at its own expenses to
The Bank of New York Mellon SA/NV, Luxembourg Branch, 2-4, rue Eugène Ruppert, L-2453 Luxembourg. This company was
incorporated in Luxembourg as a “société anonyme” on 15 December 1998 and is an indirect wholly-owned subsidiary of The Bank of New York Mellon Corporation. It is registered with the Luxembourg Trade and Companies' Register under
Corporate Identity Number B 67654 (the “Administrative Agent” and "Registrar and Transfer Agent”).
In the capacity of Administrative Agent, it carries out certain administrative duties related to the administration of the Fund,
including the calculation of the NAV of the Units and the provision of account services for the Fund.
In its capacity as Registrar and Transfer Agent, it will process all subscriptions, redemptions and transfers of units, and will
register these transactions in the units register of the Fund.
The main objective of each Sub-Fund will be to invest directly and/or indirectly in transferable securities and other Eligible
Assets, with the purpose of spreading investment risks and achieving long-term capital growth. The investment objectives of
the Sub-Funds will be carried out in compliance with the investment restrictions set forth in the latest prospectus.
At present, four Sub-Funds are at the Unitholders’ disposal:
• SEB Fund 2 - SEB Asia ex. Japan Fund • SEB Fund 2 - SEB Generation Fund 80 • SEB Fund 2 - SEB Nordic Focus Fund • SEB Fund 2 - SEB Russia Fund
Unless otherwise laid down in part II of the Prospectus, "The Sub-Funds", the Management Company may decide to issue, for each Sub-Fund, capitalisation Units ("C" Units) and distribution Units ("D" Units).
The "C" Units will reinvest their income, if any. The "D" Units may pay a dividend to its Unitholders, upon decision of the
Management Company. Dividends are paid annually, except for those Sub-Funds where the Management Company would
decide on a monthly, quarterly or semi-annual dividend payment.
6
Currently, the following unit classes are offered for the Sub-Funds:
• SEB Fund 2 - SEB Asia ex. Japan Fund
o Capitalisation units (“C (EUR)” units) LU1526326068
o Capitalisation units (“C (USD)” units) LU0011900676
o Distribution units (“D (USD)” units) LU0397043406
o Capitalisation units (“IC P (SEK)” units) LU1063552746
• SEB Fund 2 - SEB Generation Fund 80
o Capitalisation units (“C (SEK)” units) LU0303408685
• SEB Fund 2 - SEB Nordic Focus Fund
o Capitalisation units (“C (EUR)” units) LU0324984854
o Capitalisation units (“C (NOK)” units) LU0324986040
o Capitalisation units (“C (SEK)” units) LU0324985315
• SEB Fund 2 - SEB Russia Fund o Capitalisation units (“C (EUR)” units) LU0273119544
o Capitalisation units (“C (USD)” units) LU0600309446
The base currency of the Fund is US Dollar. The currency of the Sub-Fund SEB Fund 2 - SEB Asia ex. Japan Fund is US Dollar.
The currency of the Sub-Funds, SEB Fund 2 - SEB Nordic Focus Fund and SEB Fund 2 - SEB Russia Fund is Euro. The currency
of the Sub-Fund, SEB Fund 2 - SEB Generation Fund 80 is Swedish Krona.
The issue and redemption prices, which are computed daily on bank business days in Luxembourg, except 24 December and
31 December ("Valuation date"), can be obtained from the registered offices of the Management Company, the Depositary
and the Paying Agent. In addition, the Net Asset Value, fact sheets and other informational material is published on the SEB Luxembourg website
www.sebgroup.lu ("website"). When registered in other countries, the publication media might differ according to the
regulatory requirements. Information about ongoing charges can be found in the Key Investor Information
Document ("KIID").
The audited annual and un-audited semi-annual reports of the Fund may be obtained, free of charge at the registered office of the Management Company, at the address of its Branch and on the website. These reports as well as copies of the
Prospectus, the Management Regulations and the KIID are available, free of charge, at the registered office of the
Management Company, at the address of the Branch and on the website.
Management Report
7
Dear Unitholders, With this report, we want to give you an overview of the general economic environment, the development of the most
important capital markets of our Fund SEB Fund 2.
We would like to thank you for your confidence and will do everything within our power to justify your decision of investing in
our Fund. Recovery at last
Looking back at the past ten years, the perhaps most interesting tendency has been how the market’s expectations for future growth has consistently been too optimistic. Every year has started with high expectations which then are revised lower as
either a political crisis or a pre-mature - in hindsight - tightening of monetary policy has negatively affected growth. It is in this
context that 2017 stands out. For the first time since the financial crisis we have seen a strong and broad-based recovery in
growth. We regard it as broad-based in the sense that all sectors and all regions showed gains in unison. It is strong in the
sense that a range of major leading indicators ended higher than in decades. The economy’s strength did not go un-noticed in the financial markets. As investors embraced the idea that growth was finally gaining speed, and the likelihood for another disappointment fell, equities began to rally. So much in fact, that
valuations started to reach levels which in recent history have only been surpassed during the IT bubble of the late 90s.
At the time of writing, this is one of the few potential negatives for 2018. The fact that the equity markets have already
discounted much of the good macroeconomic news means we expect to see somewhat lower equity returns than 2017.
Furthermore, we also expect volatility to start rising as central banks continue to tighten monetary policy. In the following paragraphs we describe the developments and our outlook for the financial markets, global growth and
monetary policy. Financial markets As stated, 2017 was a strong year for risky assets in general and equities in particular. Global equities, measured in local
currency, rose by nearly 20%, driven in large part by a strong recovery in earnings. Despite the improving growth outlook, inflation expectations and longer dated yields ended up largely where they started at
the beginning of 2017. This disconnect was caused by a string of surprisingly weak inflation numbers coming out of the US
throughout 2017. As the labour market continued to tighten, however, the US Federal Reserve continued to hike rates in
2017 which ensured that the US yield curve flattened significantly. This development contrasted the strong growth outlook
as a flattening, inverted, yield curve traditionally is seen as a sign of an imminent recession. In a broader asset allocation context, the most interesting feature of 2017 was the low levels of volatility. The US S&P 500
implied equity volatility Index (VIX) ended up averaging the lowest levels since the inception of the index and the S&P 500 had only eight days when the index either fell or rose by more than 1%. We have to go all the way back to 1965 to find a year
which replicates this pattern. Global growth During the summer of 2017, global growth started to accelerate significantly. All major PMIs (Purchasing Manager Index)
and consumer confidence indicators started to rise in unison for the first time since the financial crisis. Not only was the
strength concerted in the sense that all major leading indicators started to rise, it was also very strong. For example, US
consumer confidence rose to the highest levels since 2001 and IFO, the leading indicator for Germany, posted its highest
levels on record.
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Given the strength in the economy over the second half of 2017, we are at a point where growth seems finally to have
consolidated. The likelihood of a slowdown in growth has fallen significantly and if leading indicators are to be trusted the
momentum seems set to continue going into 2018. Finally, it is also worth noting that global trade has once more started to rise. The growth rate in trade for large global
exporters such as South Korea has left the single digit range which has dominated since 2011. This development will be
especially beneficial for the Emerging Market space in particular. Monetary policy As growth strengthened in 2017, global central banks continued to tighten monetary policy. In contrast to the last five years
this tightening fortunately did not have a negative impact on financial markets. The US Federal Reserve hiked rates three times in 2017. This was in line with their projection, but more than what the market
was pricing. This decision to hike was largely motivated by the strong labour market, which is projected to result in higher
wage inflation, and a view that the low inflation readings of 2017 were caused by temporary factors. At the time of writing,
early 2018, there has been no material change in the Fed’s outlook and it is aiming for three hikes over the next 12 months.
The ECB announced it will continue to withdraw support through its purchases of bonds. There was some anxiety that this
announcement would have a negative effect on the broader financial markets, but this didn’t happen and the strong growth theme dominated. The development regarding the ECB announcement illustrated that central banks in general had less
impact on financial markets in 2017 than they have had in the last couple of years.
Outlook for financial markets & economic growth As of writing, we find it hard not to be constructive on the outlook for the global economy. We expect that all the positive
leading indicators (questionnaires for firms and consumers) will translate into even higher growth rates for consumption and
production in the coming months. In line with the growing economy, we expect central banks to continue to tighten monetary policy. As the US economy is
farthest ahead in the economic cycle, we expect this tightening to be driven by the Fed. We expect the ECB to follow the
announced plan of reducing their bond purchases. In terms of the financial markets, the outlook is more uncertain. As stated, much of the good news from 2017 has already
been discounted and, as such, valuations are at levels from which we do not expect to see further multiple expansion. With
that said, we believe the growth environment will remain conducive to earnings growth. We expect equities to deliver a
higher return than all major fixed income alternatives; albeit lower than 2017.
Luxembourg, 17 January 2018
SEB Investment Management AB
The Board of Director
Schedule of Investments
As at 31 December 2017
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SEB Fund 2 - SEB Asia ex. Japan Fund
Security description Maturity Total holdings Market % of
value in Net
USD Assets
Transferable securities admitted to an official stock exchange listing and/or dealt within another regulated market
Shares
Bermuda
Giordano International Ltd 318,000 169,291.07 0.10
Johnson Electric Holdings Ltd 129,000 540,648.01 0.33
K Wah International Holdings Ltd 150,000 81,965.81 0.05
Kerry Properties Ltd 183,500 825,420.00 0.51
Luk Fook Holdings International Ltd 150,000 644,017.07 0.39
Yue Yuen Industrial Holdings Ltd 574,500 2,257,054.26 1.38
Total Bermuda 4,518,396.22 2.76
Cayman Islands
Agile Group Holdings Ltd 1,792,000 2,719,795.72 1.66
Alibaba Group Holding Ltd ADR 11,600 1,993,692.00 1.22
CAR Inc 138,000 120,971.55 0.07
China Hongqiao Group Ltd 288,000 322,488.43 0.20
China Lesso Group Holdings Ltd 800,000 518,029.03 0.32
China Lilang Ltd 267,000 215,602.71 0.13
CIFI Holdings Group Co Ltd 1,960,000 1,181,382.60 0.72
Hiroca Holdings Ltd 53,000 203,925.00 0.12
JNBY Design Ltd 231,000 280,833.67 0.17
Kingboard Laminates Holdings Ltd 290,000 452,021.28 0.28
Lifestyle International Holdings Ltd 90,500 120,215.24 0.07
Logan Property Holdings Co Ltd 934,000 965,765.82 0.59
NagaCorp Ltd 772,000 597,704.14 0.37
Nexteer Automotive Group Ltd 581,000 1,384,424.90 0.84
Shimao Property Holdings Ltd 446,500 971,368.41 0.59
Tencent Holdings Ltd 97,500 5,065,755.69 3.09
Tianneng Power International Ltd 336,000 349,147.47 0.21
TOPBI International Holdings Ltd 31,843 116,100.16 0.07
WH Group Ltd 430,500 485,909.44 0.30
Xiabuxiabu Catering Management China Holdings Co Ltd 309,500 623,417.48 0.38
Xinyi Glass Holdings Ltd 2,604,000 3,392,363.25 2.07
Xinyi Solar Holdings Ltd 898,000 347,053.85 0.21
Yuzhou Properties Co Ltd 2,529,000 1,349,579.51 0.82
YY Inc ADR 7,600 852,340.00 0.52
Total Cayman Islands 24,629,887.35 15.02
China
Agricultural Bank of China Ltd H 1,337,000 622,796.81 0.38
Anhui Conch Cement Co Ltd H 431,000 2,026,974.13 1.24
Anhui Expressway Co Ltd H 120,000 100,124.98 0.06
Bank of China Ltd H 12,293,000 6,040,914.62 3.68
Bank of Chongqing Co Ltd H 151,500 120,591.48 0.07
Bank of Communications Co Ltd H 318,000 236,030.81 0.14
China Construction Bank Corp H 8,122,000 7,483,574.27 4.56
China Everbright Bank Co Ltd H 642,000 299,875.84 0.18
China Minsheng Banking Corp Ltd H 86,000 86,173.51 0.05
China Telecom Corp Ltd H 2,930,000 1,394,839.23 0.85
China Vanke Co Ltd H 24,100 96,224.40 0.06
Chongqing Rural Commercial Bank Co Ltd H 158,000 111,611.71 0.07
Huadian Fuxin Energy Corp Ltd H 1,072,000 262,024.41 0.16
Huishang Bank Corp Ltd H 145,000 79,419.17 0.05
Jiangsu Expressway Co Ltd H 770,000 1,172,603.75 0.72
10
SEB Fund 2 - SEB Asia ex. Japan Fund
Security description Maturity Total holdings Market % of
value in Net
USD Assets
PICC Property & Casualty Co Ltd H 904,000 1,737,608.59 1.06
Shenzhen Expressway Co Ltd H 518,000 525,674.05 0.32
Sinopec Shanghai Petrochemical Co Ltd H 7,560,000 4,305,220.49 2.63
Zhejiang Expressway Co Ltd H 1,432,000 1,574,163.27 0.96
Total China 28,276,445.52 17.24
Hong Kong
China Power International Development Ltd 3,678,000 964,893.05 0.59
CITIC Telecom International Holdings Ltd 433,000 114,702.22 0.07
HKT Trust & HKT Ltd 349,000 444,834.39 0.27
Hopewell Holdings Ltd 93,300 344,461.79 0.21
Hua Hong Semiconductor Ltd 279,000 591,973.58 0.36
Link REIT 76,000 704,637.21 0.43
Sino-Ocean Group Holding Ltd 158,500 109,328.06 0.07
Wharf Holdings Ltd/The 207,000 715,233.26 0.43
Total Hong Kong 3,990,063.56 2.43
India
Balrampur Chini Mills Ltd 100,033 207,502.63 0.13
HCL Technologies Ltd 194,166 2,708,940.29 1.65
Hexaware Technologies Ltd 171,449 915,030.72 0.56
Hindustan Petroleum Corp Ltd 613,648 4,024,490.19 2.45
Infosys Ltd 165,090 2,695,266.11 1.64
KPIT Technologies Ltd 102,176 289,347.36 0.18
Larsen & Toubro Infotech Ltd 3,465 60,738.97 0.04
Mphasis Ltd 26,417 300,332.98 0.18
NIIT Technologies Ltd 92,226 932,049.72 0.57
NMDC Ltd 40,587 87,625.09 0.05
SJVN Ltd 138,219 73,410.77 0.04
Tata Consultancy Services Ltd 10,357 438,311.68 0.27
Tech Mahindra Ltd 410,102 3,238,603.88 1.98
Vardhman Textiles Ltd 2,429 52,473.12 0.03
Wipro Ltd 15,743 77,509.53 0.05
Total India 16,101,633.04 9.82
Indonesia
Link Net Tbk PT 615,100 249,349.54 0.15
Total Indonesia 249,349.54 0.15
Malaysia
AirAsia Bhd 811,500 671,735.86 0.41
Astro Malaysia Holdings Bhd 125,200 81,981.41 0.05
Dagang NeXchange Bhd 727,600 87,196.62 0.05
JCY International Bhd 1,194,500 123,965.45 0.08
Malaysian Pacific Industries Bhd 105,900 330,233.03 0.20
Maxis Bhd 421,100 625,352.53 0.38
MISC Bhd 82,700 151,626.33 0.09
Padini Holdings Bhd 325,300 424,407.63 0.26
Petronas Chemicals Group Bhd 1,030,900 1,961,428.42 1.20
Tenaga Nasional Bhd 413,800 1,560,307.59 0.95
Unisem M Bhd 290,100 261,641.00 0.16
UOA Development Bhd 268,000 158,269.74 0.10
Total Malaysia 6,438,145.61 3.93
Philippines
Cebu Air Inc 269,450 539,763.33 0.33
Globe Telecom Inc 10,380 395,071.90 0.24
at
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SEB Fund 2 - SEB Asia ex. Japan Fund
Security description Maturity Total holdings Market % of
value in Net
USD Assets
Manila Electric Co 166,560 1,096,385.95 0.67
Union Bank of the Philippines 49,830 86,493.73 0.05
Total Philippines 2,117,714.91 1.29
Singapore
BOC Aviation Ltd 111,100 592,164.89 0.36
ESR-REIT 152,400 64,426.38 0.04
Fortune Real Estate Investment Trust 1,560,400 1,928,975.27 1.18
iFAST Corp Ltd 70,400 46,617.21 0.03
Mapletree Greater China Commercial Trust 963,200 886,445.24 0.54
Mapletree Industrial Trust 1,171,300 1,779,076.03 1.08
Sheng Siong Group Ltd 265,900 184,030.75 0.11
StarHub Ltd 589,000 1,256,002.44 0.77
Venture Corp Ltd 49,500 758,146.91 0.46
Yangzijiang Shipbuilding Holdings Ltd 2,260,900 2,486,732.19 1.52
Yanlord Land Group Ltd 930,400 1,127,755.73 0.69
Total Singapore 11,110,373.04 6.78
South Korea
Grand Korea Leisure Co Ltd 24,410 666,939.88 0.41
Hyundai Marine & Fire Insurance Co Ltd 989 43,419.74 0.03
LG Uplus Corp 242,372 3,169,593.17 1.93
Lotte Chemical Corp 3,264 1,121,995.22 0.68
Meritz Fire & Marine Insurance Co Ltd 52,089 1,143,423.00 0.70
Samjin Pharmaceutical Co Ltd 4,906 164,289.48 0.10
Samsung Electronics Co Ltd 3,796 9,034,802.58 5.51
Samsung Electronics Co Ltd (Pref) 652 1,272,878.41 0.78
Shinhan Financial Group Co Ltd 117,721 5,432,177.24 3.31
SK Hynix Inc 23,674 1,691,710.79 1.03
SK Telecom Co Ltd 18,973 4,731,951.75 2.88
Woori Bank 164,856 2,425,371.98 1.48
Total South Korea 30,898,553.24 18.84
Taiwan
Asustek Computer Inc 89,000 835,912.73 0.51
Aten International Co Ltd 48,000 135,490.75 0.08
China General Plastics Corp 758,290 825,599.57 0.50
Chin-Poon Industrial Co Ltd 136,000 265,524.23 0.16
Cleanaway Co Ltd 8,000 47,045.40 0.03
Eva Airways Corp 233,000 124,100.72 0.08
Formosa Chemicals & Fibre Corp 137,000 474,184.02 0.29
Formosa Petrochemical Corp 315,000 1,222,592.30 0.75
Foxconn Technology Co Ltd 1,414,450 4,049,639.04 2.47
Fubon Financial Holding Co Ltd 346,000 589,485.57 0.36
Getac Technology Corp 231,000 343,102.09 0.21
Gigabyte Technology Co Ltd 413,000 749,433.20 0.46
Grand Pacific Petrochemical 130,000 137,389.37 0.08
Ibase Technology Inc 147,141 245,000.22 0.15
Micro-Star International Co Ltd 282,000 725,883.62 0.44
Phison Electronics Corp 126,000 1,236,353.08 0.75
Pou Chen Corp 242,000 313,493.74 0.19
Powertech Technology Inc 785,000 2,321,354.40 1.42
Sinmag Equipment Corp 137,000 782,633.81 0.48
Sitronix Technology Corp 88,000 247,216.85 0.15
TaiDoc Technology Corp 32,000 104,736.50 0.06
Taiwan Semiconductor Manufacturing Co Ltd 331,784 2,558,746.42 1.56
12
SEB Fund 2 - SEB Asia ex. Japan Fund
Security description Maturity Total holdings Market % of
value in Net
USD Assets
Taiwan Styrene Monomer 138,000 105,267.44 0.07
Tripod Technology Corp 411,000 1,284,440.20 0.78
Yuanta Financial Holding Co Ltd 359,000 166,480.23 0.10
Total Taiwan 19,891,105.50 12.13
Thailand
PTT Global Chemical PCL NVDR 804,000 2,096,962.40 1.28
PTT PCL NVDR 97,300 1,313,654.58 0.80
Sansiri PCL NVDR 4,757,200 318,217.14 0.19
Siam Cement PCL/The NVDR 6,550 97,275.24 0.06
Somboon Advance Technology PCL NVDR 97,400 65,152.51 0.04
Thai Oil PCL NVDR 1,577,800 5,010,810.41 3.06
Thai Vegetable Oil PCL NVDR 591,500 539,954.78 0.33
Total Thailand 9,442,027.06 5.76
Total Shares 157,663,694.59 96.15
Investment Funds
Equity Funds
France
Lyxor MSCI AC Asia-Pacific ex-Japan UCITS ETF 14,552 931,968.16 0.57
Total France 931,968.16 0.57
Luxembourg
db x-trackers MSCI EM ASIA INDEX UCITS ETF - 1C 28,345 1,533,509.32 0.93
Total Luxembourg 1,533,509.32 0.93
Total Equity Funds 2,465,477.48 1.50
Total Investment Funds 2,465,477.48 1.50
Total Transferable securities admitted to an official stock exchange listing
and/or dealt within another regulated market 160,129,172.07 97.65
Other Transferable Securities
Shares
Hong Kong
China Metal Recycling Holdings Ltd* 867,000 0.00 0.00
Total Hong Kong 0.00 0.00
Total Shares 0.00 0.00
Total Other Transferable Securities 0.00 0.00
Total Portfolio 160,129,172.07 97.65
Financial futures cleared with Skandinaviska Enskilda Banken AB (publ)
Purchased financial futures contracts Commitment in USD
BCLEAR MSCI All Country Asia Ex Japan 2,809,994.00 21/12/18 55 45,914.00 0.03
Total financial futures contracts (total unrealised) 45,914.00 0.03
An amount of USD 203,444.00 is held as cash collateral for these positions.
at
13
SEB Fund 2 - SEB Asia ex. Japan Fund
Market
value in
USD
% of
Net
Assets
Cash at bank and at broker
Cash at bank and at broker 3,615,474.45 2.20
Total Cash at bank and at broker 3,615,474.45 2.20
Other assets
Dividends receivable 479,502.16 0.29
Bank interest receivable on cash accounts 3,362.13 0.00
Receivable on subscriptions 38,066.48 0.03
Other assets 660.83 0.00
Total other assets 521,591.60 0.32
Liabilities
Management fees (222,975.98) (0.13)
Payable on redemptions (97,639.36) (0.06)
Other liabilities (12,938.83) (0.01)
Total liabilities (333,554.17) (0.20)
Total Net Assets as at 31 December 2017 163,978,597.95 100.00
* Position fair valued by the Management Company.
A list of changes in the assets held during the financial year under review is available free of charge from SEB Investment Management AB.
The accompanying notes are an integral part of these financial statements.
Schedule of Investments
As at 31 December 2017 Heading
14
SEB Fund 2 - SEB Generation Fund 80
Security description Total holdings Market % of
value in Net
SEK Assets
Transferable securities admitted to an official stock exchange listing and/or dealt within another regulated market
Investment Funds
Equity Funds
Luxembourg
SEB Fund 1 - SEB Europe Index 74,494 5,412,199.09 3.44
SEB Fund 1 - SEB Global Fund C 726,001 26,303,018.21 16.75
SpotR OMXS30 50,906 9,715,410.10 6.19
Total Luxembourg 41,430,627.40 26.38
Sweden
SEB Europafond 2,272,496 27,159,052.73 17.29
SEB Hallbarhetsfond Global A SEK 1,583,685 27,041,256.55 17.22
SEB Nordamerikafond 922,931 12,161,366.88 7.74
Total Sweden 66,361,676.16 42.25
Total Equity Funds 107,792,303.56 68.63
Investment Funds
Luxembourg
SEB Fund 3 - SEB US Index Fund C 162,877 6,338,466.60 4.03
SEB SICAV 1 - SEB Emerging Markets Fund 605,879 16,472,562.92 10.49
Total Luxembourg 22,811,029.52 14.52
Sweden
SEB Sverige Expanderad 1,364,143 25,677,129.66 16.35
Total Sweden 25,677,129.66 16.35
Total Investment Funds 48,488,159.18 30.87
Total Investment Funds 156,280,462.74 99.50
Total Transferable securities admitted to an official stock exchange listing
and/or dealt within another regulated market 156,280,462.74 99.50
Total Portfolio 156,280,462.74 99.50
15
SEB Fund 2 - SEB Generation Fund 80
Market
value in
SEK
% of
Net
Assets
Cash at bank
Cash at bank 701,917.63 0.45
Total Cash at bank 701,917.63 0.45
Other assets
Bank interest receivable on cash accounts 141.63 0.00
Retrocession fees receivable 152,279.15 0.10
Other assets 2,869.70 0.00
Total other assets 155,290.48 0.10
Liabilities
Management fees (60,997.08) (0.05)
Other liabilities (7,690.17) (0.00)
Total liabilities (68,687.25) (0.05)
Total Net Assets as at 31 December 2017 157,068,983.60 100.00
A list of changes in the assets held during the financial year under review is available free of charge from SEB Investment Management AB.
The accompanying notes are an integral part of these financial statements.
Schedule of Investments
As at 31 December 2017 Heading
16
SEB Fund 2 - SEB Nordic Focus Fund
Security description Total holdings Market % of
value in Net
EUR Assets
Transferable securities admitted to an official stock exchange listing
Shares
Denmark
Carlsberg A/S 17,400 1,741,011.32 3.97
Dfds A/S 34,900 1,552,898.02 3.54
DSV A/S 26,723 1,753,617.01 4.00
GN Store Nord A/S 56,100 1,510,682.90 3.44
Pandora A/S 12,400 1,124,975.63 2.56
Total Denmark 7,683,184.88 17.51
Faroe Islands
Bakkafrost P/F 50,000 1,769,987.40 4.03
Total Faroe Islands 1,769,987.40 4.03
Finland
Ahlstrom-Munksjo Oyj 97,700 1,775,209.00 4.04
Cargotec Oyj 37,700 1,779,440.00 4.05
Kesko OYJ 41,200 1,864,300.00 4.25
Valmet OYJ 104,600 1,719,624.00 3.92
Total Finland 7,138,573.00 16.26
Norway
Sparebank 1 Oestlandet 145,000 1,336,017.24 3.04
SpareBank 1 SMN 165,200 1,383,379.80 3.15
Tomra Systems ASA 186,400 2,495,554.97 5.69
Yara International ASA 41,267 1,582,683.22 3.61
Total Norway 6,797,635.23 15.49
Sweden
AAK AB 24,871 1,777,065.80 4.05
AddTech AB 112,032 2,045,363.37 4.66
AF AB 96,600 1,777,377.28 4.05
Beijer Ref AB 78,461 2,525,756.53 5.75
Castellum AB 120,400 1,694,831.43 3.86
Intrum Justitia AB 60,200 1,857,089.50 4.23
Nordea Bank AB 169,100 1,707,910.00 3.89
Skandinaviska Enskilda Banken AB 182,100 1,783,611.09 4.06
Skanska AB 94,200 1,628,784.98 3.71
Swedish Match AB 53,600 1,761,976.35 4.02
Total Sweden 18,559,766.33 42.28
United States of America
Autoliv Inc 15,300 1,629,303.70 3.71
Total United States of America 1,629,303.70 3.71
Total Shares 43,578,450.54 99.28
Total Transferable securities admitted to an official stock exchange listing 43,578,450.54 99.28
Total Portfolio 43,578,450.54 99.28
17
SEB Fund 2 - SEB Nordic Focus Fund
Market
value in
EUR
% of
Net
Assets
Cash at bank
Cash at bank 379,692.45 0.86
Total Cash at bank 379,692.45 0.86
Other assets
Receivable on subscriptions 2,806.77 0.01
Total other assets 2,806.77 0.01
Liabilities
Management fees (45,004.31) (0.10)
Payable on redemptions (11,775.33) (0.03)
Bank interest payable on cash accounts (164.33) (0.00)
Other liabilities (7,759.08) (0.02)
Total liabilities (64,703.05) (0.15)
Total Net Assets as at 31 December 2017 43,896,246.71 100.00
A list of changes in the assets held during the financial year under review is available free of charge from SEB Investment Management AB.
The accompanying notes are an integral part of these financial statements.
Schedule of Investments
As at 31 December 2017
18
SEB Fund 2 - SEB Russia Fund
Security description Total holdings Market % of
value in Net
EUR Assets
Transferable securities admitted to an official stock exchange listing
Shares
Bermuda
VEON Ltd ADR 2,155,951 6,964,835.18 3.34
Total Bermuda 6,964,835.18 3.34
Cyprus
Etalon Group Plc GDR 980,707 2,569,024.61 1.23
Globaltrans Investment Plc GDR 534,672 4,152,599.72 1.99
HMS HYDRAULIC MACHINES & SYSTEMS GROUP Plc GDR 301,126 2,469,784.06 1.18
QIWI plc ADR 283,719 3,492,896.73 1.68
Ros Agro Plc GDR 7,000 57,940.07 0.03
TCS Group Holding Plc GDR 6,014 94,625.01 0.05
Total Cyprus 12,836,870.20 6.16
Kazakhstan
Halyk Savings Bank of Kazakhstan JSC GDR 918,932 7,559,995.65 3.62
KazMunaiGas Exploration Production JSC GDR 711,527 7,711,623.28 3.70
Total Kazakhstan 15,271,618.93 7.32
Luxembourg
Kernel Holding SA 4,623 53,747.64 0.02
MHP SE GDR 40,000 391,679.20 0.19
Total Luxembourg 445,426.84 0.21
Malaysia
Steppe Cement Ltd 5,000,000 1,294,267.50 0.62
Total Malaysia 1,294,267.50 0.62
Netherlands
X5 Retail Group NV GDR 175,626 5,581,026.18 2.68
Yandex NV 230,300 6,287,276.32 3.01
Total Netherlands 11,868,302.50 5.69
Russia
Aeroflot PJSC 690,653 1,395,848.66 0.67
Alrosa PJSC 982,844 1,071,074.94 0.51
Bank St Petersburg PJSC 1,462,329 1,159,854.41 0.56
ENEL RUSSIA PJSC 220,280,281 4,640,957.99 2.23
Gazprom Neft PJSC 608,797 2,170,926.65 1.04
Gazprom PJSC ADR 3,611,281 13,509,941.20 6.48
Gazprom PJSC 2,010,817 3,812,534.39 1.83
Inter RAO UES PJSC 46,906,554 2,277,265.03 1.09
LSR Group PJSC GDR 300,000 695,481.65 0.33
LUKOIL PJSC ADR 397,518 19,009,981.20 9.12
Magnit PJSC 21,061 1,919,733.25 0.92
Magnitogorsk Iron & Steel Works PJSC 2,100,154 1,290,611.84 0.62
MegaFon PJSC 193,101 1,438,937.80 0.69
MMC Norilsk Nickel PJSC ADR 245,511 3,840,297.85 1.84
Mobile TeleSystems PJSC 409,965 1,666,364.13 0.80
Moscow Exchange MICEX-RTS PJSC 837,232 1,318,980.47 0.63
Novatek PJSC GDR 69,940 7,047,527.31 3.38
Novolipetsk Steel PJSC GDR 18,047 386,660.35 0.19
OGK-2 PJSC 139,523,000 916,548.95 0.44
19
SEB Fund 2 - SEB Russia Fund
Security description Total holdings Market % of
value in Net
EUR Assets
OR PJSC 2,022,600 3,587,843.27 1.72
PhosAgro PJSC GDR 56,104 718,405.93 0.34
Polyus PJSC GDR 18,934 604,218.24 0.29
Rosneft Oil Co PJSC GDR 1,963,181 8,170,778.81 3.92
Rostelecom PJSC 2,736,477 2,523,374.27 1.21
RusHydro PJSC 271,394,537 2,858,138.15 1.37
Sberbank of Russia PJSC (Pref) 4,437,909 12,272,405.63 5.89
Sberbank of Russia PJSC 2,061,301 6,708,168.07 3.22
Severstal PJSC GDR 282,012 3,635,916.86 1.74
Sistema PJSC FC GDR 316,127 1,100,625.51 0.53
Sollers PJSC 124,788 1,137,637.75 0.55
Surgutneftegas OJSC (Pref) 18,911,204 7,697,740.76 3.69
Tatneft PJSC ADR 64,055 2,658,470.20 1.27
Tatneft PJSC (Pref) 1,268,325 6,804,881.22 3.26
Tatneft PJSC 330,453 2,287,795.06 1.10
TMK PJSC GDR 228,333 972,682.53 0.47
TMK PJSC 2,861,003 3,091,630.93 1.48
Transneft PJSC (Pref) 431 1,113,911.04 0.53
Unipro PJSC 99,635,139 3,643,461.21 1.75
United Co RUSAL Plc 4,185,048 2,477,831.92 1.19
VTB Bank PJSC 4,785,680,172 3,254,428.02 1.56
Total Russia 146,889,873.45 70.45
United Kingdom
BGEO Group Plc 20,000 801,095.31 0.39
Evraz Plc 150,000 588,835.44 0.28
KAZ Minerals Plc 39,000 374,183.99 0.18
Lenta Ltd GDR 166,938 806,149.65 0.39
Polymetal International Plc 6,192 63,450.80 0.03
TBC Bank Group Plc 77,973 1,477,789.36 0.71
United Co RUSAL Plc 2,562,500 1,503,522.99 0.72
Total United Kingdom 5,615,027.54 2.70
Total Shares 201,186,222.14 96.49
Total Transferable securities admitted to an official stock exchange listing 201,186,222.14 96.49
Total Portfolio 201,186,222.14 96.49
20
SEB Fund 2 - SEB Russia Fund
Market
value in
EUR
% of
Net
Assets
Cash at bank
Cash at bank 9,070,304.47 4.35
Total Cash at bank 9,070,304.47 4.35
Other assets
Dividends receivable 1,462,820.71 0.70
Bank interest receivable on cash accounts 25,615.41 0.01
Receivable on subscriptions 339,003.87 0.17
Other assets 5,295.45 0.00
Total other assets 1,832,735.44 0.88
Liabilities
Bank overdraft (617,796.75) (0.30)
Management fees (322,521.88) (0.15)
Payable on purchase of securities (1,791,116.00) (0.86)
Payable on redemptions (789,723.83) (0.38)
Other liabilities (69,709.16) (0.03)
Total liabilities (3,590,867.62) (1.72)
Total Net Assets as at 31 December 2017 208,498,394.43 100.00
A list of changes in the assets held during the financial year under review is available free of charge from SEB Investment Management AB.
The accompanying notes are an integral part of these financial statements.
Combined Statement of Operations
For the year ended 31 December 2017 He
The accompanying notes are an integral part of these financial statements.
21
SEB Fund 2 - SEB Fund 2 - SEB Fund 2 -
SEB Asia ex. Japan SEB Generation Fund SEB Nordic Focus
Fund 80 Fund
USD SEK EUR
Income
Investment income (note 1) 4,967,370.17 – 1,420,984.28
Bank interest on cash accounts 14,536.86 994.07 181.56
Retrocession fees (note 4) – 1,511,120.21 –Total income 4,981,907.03 1,512,114.28 1,421,165.84
Expenses
Management fees (note 2) 2,579,735.44 617,434.75 589,973.70
Taxe d'abonnement (note 5) 69,913.52 34,471.32 22,661.47
Bank interest on cash accounts 2,290.34 2,937.60 788.11
Other expenses 85,476.79 63,272.28 50,031.72
Total expenses 2,737,416.09 718,115.95 663,455.00
Net income for the year 2,244,490.94 793,998.33 757,710.84
The accompanying notes are an integral part of these financial statements.
22
SEB Fund 2 - SEB Fund 2 -
SEB Russia Fund Combined
EUR USD
Income
Investment income (note 1) 7,746,046.75 15,929,155.37
Bank interest on cash accounts 132,318.42 172,977.41
Retrocession fees (note 4) – 184,166.48
Total income 7,878,365.17 16,286,299.26
Expenses
Management fees (note 2) 4,141,461.36 8,311,898.18
Taxe d'abonnement (note 5) 114,772.96 238,464.65
Bank interest on cash accounts 750,409.60 900,225.71
Other expenses 289,105.31 498,707.34
Total expenses 5,295,749.23 9,949,295.88
Net income for the year 2,582,615.94 6,337,003.38
Combined Statement of Changes in Net Assets
For the year ended 31 December 2017
The accompanying notes are an integral part of these financial statements.
23
SEB Fund 2 - SEB Fund 2 - SEB Fund 2 -
SEB Asia ex. Japan SEB Generation Fund SEB Nordic Focus
Fund 80 Fund
USD SEK EUR
Net Assets at the beginning of the year 123,272,247.43 106,287,434.03 44,792,062.26
Net income for the year 2,244,490.94 793,998.33 757,710.84
Net realised gain / (loss) on:
- sales of securities 26,120,386.17 (3,887,106.75) 3,949,721.48
- foreign exchange (368,473.45) 45,238.44 (12,351.94)
- financial futures contracts 667,276.50 – –
Total net realised gain/(loss) 26,419,189.22 (3,841,868.31) 3,937,369.54
Change in net unrealised appreciation / (depreciation) on:
- securities 16,221,956.15 16,020,161.52 (695,283.05)
- financial futures contracts 115,434.00 – –
Total change in net unrealised appreciation / (depreciation) 16,337,390.15 16,020,161.52 (695,283.05)
Increase in Net Assets as a result of operations 45,001,070.31 12,972,291.54 3,999,797.33
Proceeds on issues of units 24,162,608.98 42,212,776.07 7,420,101.29
Payment on redemptions of units (28,035,748.21) (4,403,518.04) (12,315,714.17)
Dividends paid (421,580.56) – –
Total Net Assets as at 31 December 2017 163,978,597.95 157,068,983.60 43,896,246.71
The accompanying notes are an integral part of these financial statements.
24
SEB Fund 2 - SEB Fund 2 -
SEB Russia Fund Combined
EUR USD
Net Assets at the beginning of the year 355,374,766.95 553,865,750.60
Net income for the year 2,582,615.94 6,337,003.38
Net realised gain / (loss) on:
- sales of securities 29,838,986.42 66,042,918.81
- foreign exchange (1,497,724.25) (2,167,356.69)
- financial futures contracts – 667,276.50
Total net realised gain 28,341,262.17 64,542,838.62
Change in net unrealised appreciation / (depreciation) on:
- securities (39,022,647.27) (29,286,946.89)
- financial futures contracts – 115,434.00
Total change in net unrealised depreciation (39,022,647.27) (29,171,512.89)
Increase / (decrease) in Net Assets as a result of operations (8,098,769.16) 41,708,329.11
Proceeds on issues of units 146,488,642.60 213,250,378.20
Payment on redemptions of units (285,266,245.96) (384,213,578.14)
Dividends paid – (421,580.56)
Foreign exchange differences – 60,769,891.43
Total Net Assets as at 31 December 2017 208,498,394.43 484,959,190.64
Combined Statement of Net Assets
As at 31 December 2017
The accompanying notes are an integral part of these financial statements.
25
SEB Fund 2 - SEB Fund 2 - SEB Fund 2 -
SEB Asia ex. Japan SEB Generation Fund SEB Nordic Focus
Fund 80 Fund
USD SEK EUR
Assets
Portfolio at cost 136,236,362.24 125,695,621.20 33,321,283.01
Unrealised appreciation 23,892,809.83 30,584,841.54 10,257,167.53
Portfolio at market value (note 1) 160,129,172.07 156,280,462.74 43,578,450.54
Unrealised appreciation on financial futures contracts 45,914.00 – –Receivable interest and / or dividends 482,864.29 141.63 –Cash at bank and at broker 3,615,474.45 701,917.63 379,692.45
Other assets 38,727.31 155,148.85 2,806.77
Total Assets 164,312,152.12 157,137,670.85 43,960,949.76
Liabilities
Bank overdraft – – –Other liabilities (333,554.17) (68,687.25) (64,703.05)
Total Liabilities (333,554.17) (68,687.25) (64,703.05)
Total Net Assets as at 31 December 2017 163,978,597.95 157,068,983.60 43,896,246.71
"C (EUR)" units outstanding as at 31 December 2017 9,554.1310 – 19,447.8670
"C (NOK)" units outstanding as at 31 December 2017 – – 131,986.1350
"C (SEK)" units outstanding as at 31 December 2017 – 9,195,513.7070 1,698,875.1340
"C (USD)" units outstanding as at 31 December 2017 12,031,632.7490 – –
"D (USD)" units outstanding as at 31 December 2017 11,215,260.1700 – –
"IC P (SEK)" units outstanding as at 31 December 2017 1,075.1750 – –
Net Asset Value per "C (EUR)" unit as at 31 December 2017 119.383 – 202.324
Net Asset Value per "C (NOK)" unit as at 31 December 2017 – – 247.473
Net Asset Value per "C (SEK)" unit as at 31 December 2017 – 17.081 212.023
Net Asset Value per "C (USD)" unit as at 31 December 2017 11.795 – –
Net Asset Value per "D (USD)" unit as at 31 December 2017 1.844 – –
Net Asset Value per "IC P (SEK)" unit as at 31 December 2017 158.068 – –
The accompanying notes are an integral part of these financial statements.
26
SEB Fund 2 - SEB Fund 2 -
SEB Russia Fund Combined
EUR USD
Assets
Portfolio at cost 189,281,913.10 417,733,562.51
Unrealised appreciation 11,904,309.04 54,161,490.06
Portfolio at market value (note 1) 201,186,222.14 471,895,052.57
Unrealised appreciation on financial futures contracts – 45,914.00
Receivable interest and / or dividends 1,488,436.12 2,261,347.47
Cash at bank and at broker 9,070,304.47 14,994,673.40
Other assets 344,299.32 472,394.33
Total Assets 212,089,262.05 489,669,381.77
Liabilities
Bank overdraft (617,796.75) (738,177.78)
Other liabilities (2,973,070.87) (3,972,013.35)
Total Liabilities (3,590,867.62) (4,710,191.13)
Total Net Assets as at 31 December 2017 208,498,394.43 484,959,190.64
"C (EUR)" units outstanding as at 31 December 2017 19,858,681.3710 –
"C (USD)" units outstanding as at 31 December 2017 291,245.4040 –
Net Asset Value per "C (EUR)" unit as at 31 December 2017 10.411 –
Net Asset Value per "C (USD)" unit as at 31 December 2017 7.210 –
Statistical Information
As at 31 December 2017
The accompanying notes are an integral part of these financial statements.
27
SEB Fund 2 - SEB Fund 2 - SEB Fund 2 -
SEB Asia ex. Japan SEB Generation Fund SEB Nordic Focus
0 Fund 80 Fund
USD SEK EUR
Number of "C (EUR)" units outstanding
as at 31 December 2017 9,554.1310 – 19,447.8670
as at 31 December 2016 10.0000 – 20,013.5430
as at 31 December 2015 – – 48,706.7800
Number of "C (NOK)" units outstanding
as at 31 December 2017 – – 131,986.1350
as at 31 December 2016 – – 178,376.6130
as at 31 December 2015 – – 193,710.6140
Number of "C (SEK)" units outstanding
as at 31 December 2017 – 9,195,513.7070 1,698,875.1340
as at 31 December 2016 – 6,929,371.3760 1,873,397.2870
as at 31 December 2015 – 4,896,654.9470 1,963,136.1680
Number of "C (USD)" units outstanding
as at 31 December 2017 12,031,632.7490 – –as at 31 December 2016 12,440,717.2430 – –as at 31 December 2015 14,000,444.3480 – –
Number of "D (USD)" units outstanding
as at 31 December 2017 11,215,260.1700 – –as at 31 December 2016 11,617,458.8760 – –as at 31 December 2015 11,250,231.1110 – –
Number of "IC P (SEK)" units outstanding
as at 31 December 2017 1,075.1750 – –as at 31 December 2016 1,075.1750 – –as at 31 December 2015 1,075.1750 – –
Total Net Assets 0 0 0
as at 31 December 2017 163,978,597.95 157,068,983.60 43,896,246.71
as at 31 December 2016 123,272,247.43 106,287,434.03 44,792,062.26
as at 31 December 2015 127,214,653.96 67,383,654.09 49,346,676.85
Net Asset Value per "C (EUR)" unit
as at 31 December 2017 119.383 – 202.324
as at 31 December 2016 99.196 – 185.164
as at 31 December 2015 – – 174.897
Net Asset Value per "C (NOK)" unit
as at 31 December 2017 – – 247.473
as at 31 December 2016 – – 209.351
as at 31 December 2015 – – 209.742
Net Asset Value per "C (SEK)" unit
as at 31 December 2017 – 17.081 212.023
as at 31 December 2016 – 15.339 189.111
as at 31 December 2015 – 13.761 171.498
Net Asset Value per "C (USD)" unit
as at 31 December 2017 11.795 – –as at 31 December 2016 8.620 – –as at 31 December 2015 8.035 – –
The accompanying notes are an integral part of these financial statements.
28
SEB Fund 2 - SEB Fund 2 - SEB Fund 2 -
SEB Asia ex. Japan SEB Generation Fund SEB Nordic Focus
Fund 80 Fund
USD SEK EUR
Net Asset Value per "D (USD)" unit
as at 31 December 2017 1.844 – –as at 31 December 2016 1.379 – –as at 31 December 2015 1.307 – –
Net Asset Value per "IC P (SEK)" unit
as at 31 December 2017 158.068 – –as at 31 December 2016 126.208 – –as at 31 December 2015 108.290 – –
Dividend paid per D (USD) unit 0 0 0
2017 0.0358 – –2016 0.0220 – –2015 0.0500 – –
The accompanying notes are an integral part of these financial statements.
29
SEB Fund 2 - SEB Fund 2 -
SEB Russia Fund Combined
0
EUR USD
Number of "C (EUR)" units outstanding
as at 31 December 2017 19,858,681.3710 –as at 31 December 2016 33,388,439.2950 –as at 31 December 2015 12,281,048.7220 –
Number of "C (USD)" units outstanding
as at 31 December 2017 291,245.4040 –as at 31 December 2016 156,206.4040 –as at 31 December 2015 112,391.4220 –
Total Net Assets 0 0
as at 31 December 2017 208,498,394.43 484,959,190.64
as at 31 December 2016 355,374,766.95 553,865,750.60
as at 31 December 2015 79,641,752.24 276,034,825.96
Net Asset Value per "C (EUR)" unit
as at 31 December 2017 10.411 –as at 31 December 2016 10.615 –as at 31 December 2015 6.451 –
Net Asset Value per "C (USD)" unit
as at 31 December 2017 7.210 –as at 31 December 2016 6.432 –as at 31 December 2015 4.082 –
Additional Information on Management Fees Paid
The accompanying notes are an integral part of these financial statements. 30
SEB Fund 2 - SEB Generation Fund 80
ISIN Code Fund Name Management fees in
%
SE0000984171 SEB Europafond 1.40
LU0030164395 SEB Fund 1 - SEB Europe Index 0.40
LU0030158231 SEB Fund 1 - SEB Global Fund C 1.50
LU0268529194 SEB Fund 3 - SEB US Index Fund C 0.40
SE0000434151 SEB Hallbarhetsfond Global A SEK 1.50
SE0000984163 SEB Nordamerikafond 1.50
LU0037256269 SEB SICAV 1 - SEB Emerging Markets Fund 1.75
SE0000984197 SEB Sverige Expanderad 1.25
The management fees of these underlying funds are fully retroceded.
Notes to the Financial Statements
As at 31 December 2017
31
Note 1. Significant Accounting Policies
The financial statements have been prepared in accordance with Luxembourg regulations relating to Undertakings for
Collective Investment.
The Financial Statements have been prepared based on last Net Asset Value of the year which has been calculated on 28
December 2017 for Sub-Fund SEB Fund 2 - SEB Russia Fund and on 29 December 2017 for Sub-Funds SEB Fund 2 - SEB Asia
ex. Japan Fund, SEB Fund 2 - SEB Generation Fund 80 and SEB Fund 2 - SEB Nordic Focus Fund with the prices as of that
date; the valuations at 28 and 29 December 2017 have been presented for the purpose of these Financial Statements.
Investments:
a) Transferable securities and money market instruments, which are officially listed on a stock exchange, are valued at the last available price. b) Transferable securities and money market instruments, which are not officially listed on a stock exchange, but which are
traded on another regulated market are valued at a price no lower than the bid price and no higher than the ask price at the
time of the valuation and at which the Management Company considers to be an appropriate market price. c) Transferable securities and money market instruments quoted or traded on several markets are valued on the basis of the
last available price on the principal market for the transferable securities or money market instruments in question, unless
these prices are not representative. d) In the event that such prices are not in line with market conditions, or for securities and money market instruments other
than those covered in a), b) and c) above for which there are no fixed prices, these securities and money market instruments,
as well as other assets, will be valued at the current market value as determined in good faith by the Management Company, following generally accepted valuation principles. e) Units or shares of UCI(TS) are valued at the last available Net Asset Value obtained from the Administrative Agent of such
UCI(TS) except for Exchange Traded Funds which are valued at the latest available price found on the main stock exchange
on which they are listed.
f) Derivatives instruments traded on regulated markets or stock exchanges are valued at last available settlement prices of
these contracts on regulated markets or stock exchanges on which the derivative instruments are traded by the Fund.
Derivatives instruments not traded on regulated markets or on stock exchanges are valued at their net liquidating value
determined, pursuant to the policies established in good faith by the Management Company on a basis consistently applied for each different variety of contracts, in accordance with generally recognised principles, taking into consideration the
generally accepted accounting practices, the customary practices in line with the market and the interests of the Unitholders. g) Financial Futures Contracts, which are not matured, are valued at valuation date at market rates prevailing at this date and resulting unrealised appreciation or depreciation are posted as change in net unrealised appreciation/(depreciation) on
financial future contracts to the Combined Statement of Changes in Net Assets.
In the case that extraordinary circumstances occur which make it impossible or even wrong to make a valuation in
accordance with the above-mentioned criteria, the Management Company is entitled to temporarily apply other generally accepted valuation procedures, which are determined by it in good faith, in order to make an appropriate valuation of the
Fund's Assets.
Gains and losses on the sale of securities are determined using the average cost method.
32
Swing pricing:
The Investment Manager needs to perform transactions in order to uphold the desired asset allocation as a result of the flows in and out of the Sub-Funds. While performing these transactions brokerage and transaction costs will occur. Acting in
the Unitholders' interest, the Net Asset Value will be adjusted upwards in case of large inflows and downwards in case of
large outflows if on any Valuation Day the aggregate inflows and outflows in all Classes of a Sub-Fund result in a net increase
or decrease of units which exceeds a threshold set by the Board of Directors of the Management Company from time to time (relating to the cost of market dealing for the Sub-Fund), the Net Asset Value per unit of the relevant Sub-Fund will be
adjusted to reflect both the estimated fiscal charges and dealing costs (brokerage and transaction costs) that may be incurred by the Sub-Fund and the estimated bid/offer spread of the assets in which the respective Sub-Fund invests following
the net inflows/outflows of the Sub-Fund. The adjustment will be an addition when the net movement results in a net
inflows of the Sub-Fund and a deduction when it results in a net outflows. Adjustments made during the year are recorded in
“Proceeds on issues of units” and “Payment on redemptions of units” in the Combined Statement of Changes in Net Assets.
No swing pricing adjustment has been applied to the year end Net Asset Value per unit calculated on 28 December 2017 and
29 December 2017.
Currency translation:
All assets denominated in a different currency to the respective Sub-Funds' currency are converted into this respective Sub-
Funds' currency at the last available exchange rate. Separate accounts are maintained for the Sub-Fund in the currency in which the Net Asset Value per unit to which it relates is
expressed (the "accounting currency"). Transactions denominated in a currency other than the accounting currency are recorded on the basis of exchange rates
prevailing on the date they occur or accrue to the Sub-Fund. Assets and liabilities, expressed in a currency other than the accounting currency, are translated on the basis of exchange
rates ruling at the balance sheet date. The consolidated total is translated into USD at the year end date exchange rate. The Sub-Funds are priced at either intraday or close of business. The exchange rates are presented in line with when these
Sub-Funds are priced. As at 28 December 2017, the intraday exchange rates were as follows for SEB Fund 2 - SEB Russia Fund were as follows:
1 EUR = 1.194855391 USD 1 PLN = 0.285658145 USD
1 CAD = 0.793737457 USD 1 GBP = 1.344750001 USD
1 RUB = 0.017373167 USD 1 HKD = 0.127932530 USD
1 SEK = 0.121430893 USD
As at 29 December 2017, the intraday exchange rates were as follows for SEB Fund 2 - SEB Asia ex. Japan Fund,
SEB Fund 2 - SEB Generation Fund 80 and the combined figures were as follows: 1 CNY = 0.153562137 USD 1 MYR = 0.247095707 USD
1 EUR = 1.199325673 USD 1 NOK = 0.121954410 USD
1 GBP = 1.351700000 USD 1 PHP = 0.020032041 USD
1 HKD = 0.127971598 USD 1 SEK = 0.121874141 USD
1 IDR = 0.000073706 USD 1 SGD = 0.748221749 USD
1 INR = 0.015667234 USD 1 THB = 0.030684261 USD
1 JPY = 0.008887702 USD 1 TWD = 0.033603856 USD
1 KRW = 0.000934099 USD
33
As at 29 December 2017, the close of business exchange rates for SEB Fund 2 - SEB Nordic Focus Fund were as follows:
1 DKK = 0.161280708 USD 1 NOK = 0.122259277 USD
1 EUR = 1.200843320 USD 1 SEK = 0.122137853 USD
Income: Interest income and bank interest income are recognised on an accrual basis. Dividends are recorded on the ex-dividend
date. This income is shown net of any withholding taxes and adjusted accordingly when tax reclaims apply.
Note 2. Management Fees
In payment for its services, the Management Company receives an annual rate of:
• 1.75% is charged on SEB Fund 2 - SEB Asia ex. Japan Fund “C” (EUR) units (maximum rate: 1.75%)
• 1.75% is charged on SEB Fund 2 - SEB Asia ex. Japan Fund “C” (USD) units (maximum rate: 1.75%)
• 1.75% is charged on SEB Fund 2 - SEB Asia ex. Japan Fund “D” (USD) units (maximum rate: 1.75%)
• 0.75% is charged on SEB Fund 2 - SEB Asia ex. Japan Fund “IC P” (SEK) units (maximum rate: 1.75%)
• 0.50% is charged on SEB Fund 2 - SEB Generation Fund 80 “C” (SEK) units (maximum rate: 1.75%)
• 1.30% is charged on SEB Fund 2 - SEB Nordic Focus Fund “C” (EUR) units (maximum rate: 1.75%)
• 1.30% is charged on SEB Fund 2 - SEB Nordic Focus Fund “C” (NOK) units (maximum rate: 1.75%)
• 1.30% is charged on SEB Fund 2 - SEB Nordic Focus Fund “C” (SEK) units (maximum rate: 1.75%)
• 2.00% is charged on SEB Fund 2 - SEB Russia Fund “C” (EUR) units (maximum rate: 2.50%)
• 2.00% is charged on SEB Fund 2 - SEB Russia Fund “C” (USD) units (maximum rate: 2.50%)
A twelfth of this rate is being payable at the end of each month and based on the average Net Assets of each Sub-Fund
calculated daily during the relevant month.
The Management Company pays accounting, administration and depositary fees on behalf of the Fund.
Note 3. Performance Fees
In addition to the management fees, the Management Company is entitled to performance fees in the applicable unit class of
the SEB Fund 2 - SEB Nordic Focus Fund. The performance fee is calculated, accrued and crystallised on a daily basis and
paid out of the assets of the applicable unit class of the Sub-Fund at the end of each month. The calculation of the
performance fees takes place on the basis of the units of the respective unit class in circulation at the respective Valuation
Day.
The performance fees per unit of the applicable unit class of the Sub-Fund equals 20% of the appreciation of the Net Asset
Value per unit of the applicable unit class of the Sub-Fund over the benchmark, which is the VINX Top 100, pre performance
fees, but post the management fees and other types of fees, above the current Hurdle Value of the applicable unit class of
the Sub-Fund.
Note 4. Retrocession Fees
Retrocession of management fees received by the Fund related to investments made in underlying investment funds are
recorded in the caption "Retrocession fees" in the Combined Statement of Operations.
34
Note 5. Taxation
The Fund is liable in Luxembourg to a subscription tax ("taxe d'abonnement") of 0.05% or 0.01% (as applicable) per annum
of its NAV, such tax being payable quarterly on the basis of the value of the aggregate Net Assets of the Sub-Funds at the end of the relevant calendar quarter. Investments by a Sub-Fund in shares or units of another Luxembourg undertaking for
collective investment which are also subject to the taxe d’abonnement are excluded from the NAV of the Sub-Fund serving as basis for the calculation of this tax to be paid by the Sub-Fund. No stamp duty or other tax is payable in Luxembourg on the issue of units. Interest, dividend and other income realised by a Sub-Fund on the sale of securities of non-Luxembourg issuers, may be
subject to withholding and other taxes levied by the jurisdictions in which the income is sourced. Indian Tax
Each sub-fund may be subject to corporation taxes in certain countries in which it invests. Capital gains realised when
disposing of certain Indian securities held by a sub-fund are subject to capital gains tax in India, which, if any, is disclosed in
the Combined Statement of Operations under the heading "Other expenses". The tax is computed on net realised gains, and
realised losses in excess of gains may under certain conditions be carried forward 8 years to offset future gains. Indian tax
law imposes a tax of 15% on net realised gains from Indian securities sold within one year from the date of purchase. Given
the Company's intent to hold portfolio securities for more than one year, the Company does not accrue a deferred tax liability
on net unrealised gains on Indian securities.
In case the Company incurred a total realised loss on security sales as at fiscal year-end, the Company could recover the
taxable amount paid during the year on net realised gains, provided that a claim to the Tax Administration is introduced
within 2 years as from end of the financial years.
Note 6. Transaction Fees
Transaction fees incurred by the Fund relating to the purchase or sale of transferable securities, money market instruments, derivatives or other eligible assets are mainly composed of depositary fees and broker fees. Most of the transaction fees are included in the transaction price used to calculate the realised and unrealised gain/(loss) on securities.
As at 31 December 2017, the transaction fees were as follows:
SEB Fund 2 - SEB Asia ex. Japan Fund 488,590.16 USD SEB Fund 2 - SEB Generation Fund 80 26,481.20 SEK SEB Fund 2 - SEB Nordic Focus Fund 9,171.76 EUR
SEB Fund 2 - SEB Russia Fund 614,863.09 EUR
Note 7. Significant Events during the year
Prospectus
A new prospectus was issued in November 2017.
Directors
There were changes to the Board of Directors of the Management Company during the year. Please refer to the Organisation
section on page 3 for details.
Effective 1 April 2017, BNY Mellon has merged its legal entity The Bank of New York Mellon (Luxembourg) S.A., into The
Bank of New York Mellon SA/NV, Luxembourg Branch.
Note 8. Subsequent Events after the year end
There are no subsequent events after the year end.
35
Audit Report
To the Unitholders of
SEB Fund 2
Our opinion
In our opinion, the accompanying financial statements give a true and fair view of the financial position of SEB Fund 2 (the
“Fund”) and of each of its sub-funds as at 31 December 2017, and of the results of their operations and changes in their net
assets for the year then ended in accordance with Luxembourg legal and regulatory requirements relating to the preparation
and presentation of the financial statements.
What we have audited
The Fund’s financial statements comprise:
• the combined statement of net assets as at 31 December 2017;
• the schedule of investments as at 31 December 2017;
• the combined statement of operations for the year then ended;
• the combined statement of changes in net assets for the year then ended; and
• the notes to the financial statements, which include a summary of significant accounting policies.
Basis for opinion
We conducted our audit in accordance with the Law of 23 July 2016 on the audit profession (Law of 23 July 2016) and with
International Standards on Auditing (ISAs) as adopted for Luxembourg by the “Commission de Surveillance du Secteur
Financier” (CSSF). Our responsibilities under those Law and standards are further described in the “Responsibilities of the
“Réviseur d’entreprises agréé” for the audit of the financial statements” section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
....................................................................................................................................................................................................................................................................................................... PricewaterhouseCoopers, Société coopérative, 2 rue Gerhard Mercator, BP 1443, L-1014 Luxembourg T: +352 4948481, F:+352 494848 2900, www.pwc.lu Cabinet de révision agréé. Expert-comptable (autorisation gouvernementale n°10028256) R.C.S. Luxembourg B 65 477 - TVA LU25482518
36
We are independent of the Fund in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for
Professional Accountants (IESBA Code) as adopted for Luxembourg by the CSSF together with the ethical requirements that are
relevant to our audit of the financial statements. We have fulfilled our other ethical responsibilities under those ethical
requirements.
Other information
The Board of Directors of the Management Company is responsible for the other information. The other information
comprises the information stated in the annual report but does not include the financial statements and our audit report
thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information identified above
and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our
knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed,
we conclude that there is a material misstatement of this other information, we are required to report that fact. We have
nothing to report in this regard.
Responsibilities of the Board of Directors of the Management Company and those charged with governance for the financial
statements
The Board of Directors of the Management Company is responsible for the preparation and fair presentation of the financial
statements in accordance with Luxembourg legal and regulatory requirements relating to the preparation and presentation of the
financial statements, and for such internal control as the Board of Directors of the Management Company determines is necessary
to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors of the Management Company is responsible for assessing the
Fund’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the Board of Directors of the Management Company either intends to liquidate the Fund
or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Fund’s financial reporting process.
_I-pwc
Responsibilities of the "Reviseur d’entreprises agree" for the audit of the financial statements
The objectives of our audit are to obtain reasonable assurance about whether the financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an audit report that includes our opinion. Reasonableassurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Law of 23 July2016 and with |SAs as adopted for Luxembourg by the CSSF will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they couldreasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with the Law of 23 July 2016 and with |SAs as adopted for Luxembourg by the CSSF, weexercise professional judgment and maintain professional scepticism throughout the audit.
We also:
0 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, designand perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than forone resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or theoverride of internal control;
0 obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriatein the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds internal control;
0 evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and relateddisclosures made by the Board of Directors of the Management Company;
0 conclude on the appropriateness of the Board of Directors of the Management Company's use of the going concern basisof accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Fund's ability to continue as a going concern. If we conclude that amaterial uncertainty exists, we are required to draw attention in our audit report to the related disclosures in the financialstatements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our audit report. However, future events or conditions may cause the Fund to cease to continueas a going concern;
0 evaluate the overall presentation, structure and content of the financial statements, including the disclosures, andwhether the financial statements represent the underlying transactions and events in a manner that achieves fairpresentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of theaudit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Pricewaterhbus ociét_é coopérative Luxembourg, 3 April 2018
Emmanuel C ataignier
37
Risk Disclosure (unaudited)
38
In the context of risk measurement and in accordance with CSSF Circular 11/512 a UCITS must calculate its global exposure
on at least a daily basis.
For SEB Fund 2, the global exposure is calculated and monitored daily by using the calculation methodology Value at Risk (VaR) or the commitment methodology. The VaR model used is parametric VaR. The observation period is at least 250 days. The VaR methodology provides an estimate of the maximum potential loss over a specific time period and at a given
confidence level, i.e. probability level. Usually for UCITS, the time period is 1 month/20 business days and the confidence
level is 99%.
For example, a VaR estimate of 3% on a 20-days’ time period with a 99% confidence level means that, with 99% certainty,
the percentage the Fund can expect to lose over the next 20 days’ period should be a maximum of 3%.
In case of the VaR methodology, the Fund can use either the “relative” or the “absolute” VaR approach.
According to CSSF Circular 11/512, the absolute VaR approach must not be greater than 20% based on a 99% confidence
level and a holding period of 1 month/20 business days. In the case of the relative VaR approach, the VaR of the Fund must not be greater than twice the VaR of its reference portfolio. Nevertheless, lower limitations than those ones set by the
regulator can be set in accordance with the investment policy/strategy of the Fund. In addition to the VaR, the level of leverage generated through the use of derivatives and the use of collateral in relation to
efficient portfolio management transactions (i.e. securities lending or repurchase agreements) is monitored twice a month.
Leverage is measured as the sum of the absolute notional exposures of the financial derivative instruments (i.e. the absolute
sum of all long and short notional positions in derivatives compared to the Net Asset Value of the Fund) and the reinvestment
of collateral related to securities lending or repurchase agreement used by the Fund.
The Investment Manager calculates the leverage on a gross or on a commitment method. The gross method converts all
positions on derivative financial instruments into equivalent positions in the underlying assets, while the commitment method
applies the same while allowing netting and hedging arrangements.
The table overleaf summarises the Fund indicating the VaR or commitment approach, the reference portfolio (in the case of
relative VaR), the lowest/highest and average utilisation of VaR (expressed as a percentage of the respective absolute or
relative legal VaR limit) as well as the average level of leverage for the year ended 31 December 2017 Or in other cases, the minimum, maximum and average leverage within the commitment method:
39
Fund Relative/
Absolute
VaR
Reference
portfolio
Lowest
utilisation of
VaR
Highest
utilisation
of VaR
Average
utilisation
of VaR
Average
leverage
(FX forwards
serving the
purposes of
unit-class(es)
hedging, if
any, are not
included in
the leverage
calculation)
Average
Leverage
(including
FX
forwards
for unit-
class
hedging)
SEB Fund 2 - SEB Asia
ex. Japan
Fund
Relative*
MSCI All
Country Asia
ex Japan Net
Return Index
47.04% 51.56% 49.36 % 1.84 % 1.84 %
SEB Fund 2 - SEB
Generation
Fund
80
Relative*
MSCI All
Country
World Net
Return Index
(75%), OMX
Stockholm
Index (25%)
46.77% 48.95% 48.07 % 0 % 0 %
SEB Fund 2 - SEB Nordic
Focus Fund
Relative*
VINX Top
100 Index
48.99 % 53.91% 50.92 % 0 % 0 %
SEB Fund 2 - SEB Russia
Fund
Relative*
MSCI Russia
10/40 TR Net
Return Index
38.22 % 48.23 % 45.68 % 0 % 0 %
* As of 14 November 2017, the Sub-Fund global exposure calculation method converted to a commitment approach.
For SEB Fund 2 - SEB Asia ex. Japan Fund, SEB Fund 2 -SEB Generation Fund 80, SEB Fund 2 -SEB Nordic Focus Fund and SEB
Fund 2 -SEB Russia Fund, the global exposure is calculated and monitored daily by using commitment approach.
The commitment approach figures for the year ending 31 December 2017:
Fund Commitment Method Leverage
Limit Minimum Average Maximum
SEB Fund 2 - SEB Asia ex. Japan Fund 100% 1.67% 1.74% 2.05%
SEB Fund 2 - SEB Generation Fund 80 100% 0.00% 0.00% 0.00%
SEB Fund 2 - SEB Nordic Focus Fund 100% 0.00% 0.00% 0.00%
SEB Fund 2 - SEB Russia Fund 100% 0.00% 0.00% 0.00%
Remuneration Disclosure (unaudited)
40
SEB Investment Management AB (the Management Company) wishes to encourage and incite good performance and sound
behaviour, as well as to endeavour to achieve balanced risk-taking that is aligned with the interests of fund unitholders.
The Management Company has a long-term vision regarding the employment conditions of its staff. Total remuneration shall
contribute to developing the Management Company's competitiveness and profitability through the Company being able to
attract, retain, motivate and reward competent and skilful employees. In order to achieve this objective, the Management
Company's board of directors has adopted a remuneration policy based on Swedish and international regulations. The purpose of
the remuneration policy is to ensure that the Management Company has a remuneration system that is adapted to the fund
unitholders' long-term interests and the Management Company's strategy and values.
The remuneration policy is based on the remuneration model that is applied at Group level, and is built on SEB's values. The
Management Company's remuneration policy is reviewed at least annually. The Management Company's current remuneration
policy is based on a risk analysis that has been prepared by the Management Company's risk control department.
The Management Company’s remuneration structure is based on three components:
• Fixed remuneration (basic salary)
• Variable remuneration
• Pensions and other benefits
The remuneration components are used to achieve a competitive individual level of remuneration with an appropriate balance
between fixed and variable remuneration.
The fixed remuneration component is individually adapted further to predetermined internal and external appraisals. The level of
the fixed remuneration is based on the employee's experience, long-term performance and behaviour.
All employees at the Management Company are embraced by SEB's collective profit sharing model that has a predetermined
maximum outcome. The remuneration is established based on SEB's earnings and customer satisfaction.
Remuneration to employees in control departments (internal audit, risk control, and observance of regulations) is established by
the board of directors further to proposals from the Management Company's remuneration committee. Remuneration shall be
based on objective grounds related to the employee's role and tasks, and be independent of the business unit that the control
department scrutinises.
Employees in departments that have a monitoring function, such as internal auditing, risk control or compliance, are not to
receive any other variable remuneration over and above SEB's profit sharing.
The Management Company applies the grandfather principle to all remuneration, which means all decisions are to be approved
by, at the least, the manager for the manager of the employee concerned.
Variable remuneration
The Management Company uses variable remuneration in order to develop and reward performance and behaviour that create
both short-term and long-term value for the fund unitholders and the Management Company. Variable remuneration is an
important aspect of designing a flexible remuneration system. Variable remuneration is composed of both cash and units/shares
in investment funds or financial instruments which achieve the equivalent common interests as units/shares in the relevant
investment funds.
The principles for variable remuneration adopted by the Management Company are established with the objective of reflecting
the Management Company's low risk tolerance and being compatible with the Fund's prevailing risk profiles, fund rules,
discretionary mandates, as well as internal and external regulations. The variable remuneration shall be based on the employee's
performance and behaviour from a several-year perspective, as well as the performance and economic results of the employee's
team, the Management Company and SEB as a whole.
At the same time as obtaining a sound balance between fixed and variable remuneration, the payment of variable remuneration
shall be related to the Management Company's risk policy and creation of value for the fund unitholders. This implies that certain
maximum levels and deferment of payment shall apply to different personnel categories.
41
For employees in positions that have a significant influence on the Management Company's or the managed funds’ risk profile,
the maximum variable remuneration may not exceed 100 percent of the fixed remuneration. The variable remuneration is to be
deferred by 40 to 60 percent for a minimum of three years. At least 50 percent of the variable remuneration is to consist of
units/shares in investment funds or instruments which achieve the same common interests as units/shares in the relevant
securities funds. Variable remuneration in the form of fund units/shares will be subject to retention policy for at least one year.
This retention policy applies to variable compensation whether or not it is deferred.
The Management Company also applies a special remuneration model for certain employees who manage funds and
discretionary mandates. The remuneration model for these persons is based on a structure with distinct rules for maximum
outcome of remuneration, deferment of remuneration as well as rules regarding downward adjustment/reduction of
remuneration.
Payment of deferred remuneration shall only be made if such is motivated based on the Management Company's economic
situation and the performance of the Management Company, the relevant division and the employee.
Reduction or downward adjustment of deferred variable remuneration shall apply should losses, increased risks and costs arise
during the deferment period, which includes for example taking into consideration the employee's observance of external and
internal regulations. Reduction or downward adjustment shall also take place should payment be deemed unwarrantable in view
of the Management Company's financial situation.
The variable remuneration system shall be continuously reviewed in order to ensure that it does not create any unsuitable
behaviour and contribute to excessive risk-taking.
The remuneration committee
The Management Company has appointed a remuneration committee with the task of independently appraising the
remuneration policy. The remuneration committee shall be responsible for preparing decisions regarding remuneration that are
to be adopted by the board of directors, and intervene if a decision could imply consequences for the Management Company's
risks and risk management. The remuneration committee is an independent body composed of the board of directors'
independent members.
Follow up
The CEO, the deputy CEO and the board of directors shall ensure that the remuneration policy is operationally applied. The
remuneration policy shall be reviewed annually by the internal audit department or by an independent auditing firm. In order to
ensure that the Management Company's remuneration system is applied in accordance with the remuneration policy, the
remuneration system and the payment of remuneration shall be reviewed annually by internal or external auditors.
Regulated staff Paid remuneration and benefits, 2017
(thousand)
USD
- Employees in leading strategic positions 2,869
- Employees responsible for control 515
- Risk-takers 10,892
- Employees whose total remuneration amounts to or exceeds the
total remuneration to any of the Executive Board
-
Total remuneration paid
(thousand)
USD
- All employees (fixed remuneration) 17,957
- All employees (variable remuneration) 4,374
Number of employees during the year 134
42
SEB Investment Management AB, Luxembourg Branch 4, rue Peternelchen, L-2370 Howald, Luxembourg Postal address: PO Box 2053, L-1020 Luxembourg Phone +352 - 26 23 1; Fax +352 - 26 23 25 55 www.sebgroup.lu