Asked previously to comment on individual banks and their cross-border payment volumes and asked now by the banks themselves to publish additional information on their activities, the Bank of Estonia on Monday provided an exceptional release of information regarding the cross-border payments made by banks operating in Estonia.
In addition to publishing the total payment volumes for the Estonian banking industry, the Bank of Estonia has been asked to comment on individual banks and their cross-border payment volumes. The central bank is responsible for compiling official statistics on the financial sector and is thereby bound by the rules that prohibit it from distributing data on individual banks, the Bank of Estonia said in a press release on Monday.
Now the banks themselves have asked the central bank to publish additional information on their activities, as more granular data on cross-border payments would help in understanding the banks' various business models.
In a 5 October press release, the Bank of Estonia published the total amounts for cross-border customer payments and explained that those are not particularly large in international comparison.
The figures and tables below, however, describe the relative importance of individual banks in processing cross-border customer payments, as they are both received in and initiated from Estonian banks. The statistics clearly show that a large share of total cross-border payments was processed by Danske Bank, the payment volumes of which increased significantly until 2014, after which they saw a sharp drop. Given the relatively small size of Versobank, the volume of its cross-border transactions between 2013 and 2016 also stands out.
The licence of Versobank was withdrawn by the European Central Bank on 26 March at the request of Estonia's Financial Supervision Authority (FSA). Inspections by the FSA at Danske Bank identified serious shortcomings in its anti-money laundering procedures from 2007 onwards. The FSA informed the Danish Financial Supervisory Authority of its findings in 2007, 2009, 2012, 2013 and 2014. Following an injunction issued by the FSA, Danske Bank stopped providing payment services to high-risk non-resident customers through its Estonian branch by the end of 2015.
The dynamics of the cross-border payments of the other larger banks in the Estonian market may be affected by changes in their customer segments, but they can generally be explained by developments in the Estonian economy more broadly, and changes in the market share of the banks in the Estonian market.
Editor: Aili Vahtla