"We believe in a significant value potential of the company".

• Swedish banks outperform European peers

Cevian Capital, a Swedish active ownership investment firm run by businessman Christer Gardell, said Monday it now controls 4.64 percent of Sweden's fourth largest bank Swedbank through its fund Cevian Capital II.

"We believe in a significant value potential of the company", Christer Gardell told business daily Dagens Industri. "Swedbank has been through a tough period in the Baltic countries, but the Swedish operations have performed well throughout the crisis. We believe that there is long-term high earnings in the company that is not reflected in current prices".

The stake would make Cevian Swedbank's third largest owner, after Folksam Insurance and a foundation of independent savings banks (assuming they haven't sold their shares). Cevian's funds owns 3.58 percent of shares, while a further 1.06 percent of shares are owned by its partner, billionaire US activist investor Carl Icahn.

Shares Swedbank, the biggest bank in Estonia, Latvia and Lithuania, have soared almost six-fold since March 2009, beating a 132 percent increase in the 52-member Bloomberg Europe Banks and Financial Services Index, the newswire said. Credit quality has improved more rapidly than expected in the Baltic countries and the macroeconomic developments in its home markets have been favorable, the company said as last month.

The bank swung to a second-quarter net profit of 1.57 billion kronor ($212 million) from a loss of 2.01 billion kronor a year earlier. The result was more than double analyst expectations as loan losses came in well below forecasts.

Cevian Capital was founded in 2002 by Christer Gardell and Lars Förberg. Today, the investment firm has more than 3,5 billion euros in assets under management.

Shares in Swedbank rose 1.70 percent in Monday morning trading.