A listed bank has run without budgets for 55 years - and its new CEO cut the centre, not the branches

Handelsbanken is the longest-running, best-audited Beta case there is: no budgets since the early 1970s, the branch as the profit centre, relative league tables instead of targets, and a collective profit share instead of bonuses. The 2024 leadership change strengthened the model rather than reversing it.

Last reviewed: 16 September 2026

Why this status

Audited public figures, independent customer-satisfaction rankings, and a leadership change in 2024 that deepened decentralisation. Two caveats belong in every mention.

What makes it a Beta case

"The branch is the bank": every branch is a self-contained unit with its own profit and loss, its own pricing and credit decisions within a framework, and its own customers. Head office serves the branches; it does not steer them.
No budgets since Jan Wallander abolished them around 1970-72. Steering works through relative comparison: branches and regions are ranked monthly on return on equity and cost-income ratio against each other, not against a plan.
The "church spire principle": a branch only does business it can see from its own church spire - local market, local judgement, no central sales campaigns.
Oktogonen: a collective profit-sharing foundation with the same share for every employee, paid out at retirement. No individual bonuses, no sales targets.

What is documented

2025: operating profit SEK 30.75bn, return on equity 13.0%, cost-income ratio 41.5%. First half of 2026: return on equity 13.2%, cost-income ratio 41.8%, costs falling despite inflation (annual and interim reports).
Michael Green, CEO since 1 January 2024, called the group functions "bloated" and cut central staff from about 8% to 4% of the workforce; 4,100 central positions were put under review in July 2024. The branches were not part of the programme.
Customer satisfaction: SKI 2025 ranks Handelsbanken first among the large Swedish banks; EPSI ranks it first in the Netherlands for 13 consecutive years and in the UK for 17.
Exit from Denmark (2022) and Finland (2024) is a focusing move to four home markets, not a retreat from the model - the remaining 407 branches keep full branch autonomy.

Where it cracks

Operating profit fell 12% in 2025 against 2024 (SEK 35.0bn) - a normal interest-rate cycle effect, but it must be stated whenever the 2024 figure is quoted.
Between 2020 and 2022 the bank closed roughly half of its Swedish branches (about 380 to 200). Analysts at the time read that as a break with "the branch is the bank"; the bank read it as adapting branch count to digital behaviour. Both readings exist.
Oktogonen received only SEK 142m in 2025 - the profit share is real but no longer large.
Banking is a sector in which the branch is a natural profit centre. The transfer to organisations without such units is not proven by this case.

Verdict

Handelsbanken is the case to open with when someone asks whether Beta works in a regulated, listed, large organisation. It is not a start-up, not founder-led, not private, and the numbers are audited. The 2024 change of CEO is the strongest recent evidence: a new leader with a mandate to cut costs cut the centre and left the periphery alone. That is Beta behaviour under pressure, and it is rare.

For a talk

A bank has beaten its peers for fifty years without a single budget, and when it had to save money it cut head office, not the branches.

Sources

Handelsbanken: Highlights of the Annual Report 2025 (2026-02)
Handelsbanken: Interim Report January-June 2026 (2026-07)
Handelsbanken: About the Group (branches, decentralisation) (2026)
Bloomberg Law: Handelsbanken's new CEO wants to trim bloated group functions (2024-01)
MarketScreener/Di: 4,100 central jobs under review (2024-07)
Svenskt Kvalitetsindex: Bank 2025 (2025-10)
Handelsbanken NL: EPSI customer satisfaction (2025)
The Local: Handelsbanken to close more than 100 branches (2020-09-16)

Website: handelsbanken.com