Swedbank remains secure for customers, says suspended CEO ({{commentsTotal}})

Robert Kitt.
Robert Kitt. Source: ERR

Suspended Swedbank CEO Robert Kitt says that regardless of the outcome of either the bank's internal investigation into potential Anti-Money Laundering (AML) infringements, or external investigations by the supervisory authorities, Swedbank will remain a safe and reputable bank for customers.

Swedbank announced Monday evening that Kitt, together with the bank's CFO, Vaiko Tammeväli, were to be suspended while its ongoing investigation is held.

The two men are still officially Swedbank employees, but will not be coming into work on a day-to-day basis while the suspension lasts.

In late March, Swedish public broadcaster SVT obtained an internal report conducted by Swedbank which stated that within a 10 year period, around €135 billion in high-risk money moved through the bank's Estonian branch.

The time period roughly coincided with the €160 billion in potentially illicit funds thought to have passed through Danske Estonia, which is to shut its doors this year, between 2007 and 2015.

Priit Perens has also been suspended from Swedbank's supervisory board and will end his employment with the bank, it announced Monday evening.

At a press conference held on Tuesday morning by Swedbank's head of Baltic banking Charlotte Elsnitz, together with the acting replacements for Kitt and Tammeväli, Olavi Lepp and Anna Kouts, said that it would be business as usual for the bank while the investigations were underway. The panel were unable to comment on the likely outcome or even duration of the investigation.

"I can sincerely say that Swedbank is still a heavily capitalized bank and eveb if there have been some dark scenarios ... If mistakes are made, they must be corrected," Kitt said on ERR morning show "Terevisioon".

"However, as far as bank deposits and borrowers are concerned, Swedbank is still a very secure bank," Kitt continued.

Kitt also noted that in the run up to the investigation, a number of articles and accusations appeared in the media regarding the bank.

Swedbank takes these very seriously and is thus carrying out an extensive internal investigation, in addition to the external investigations by the Estonian and Swedish financial supervisory authorities, as well as other authorities, Kitt said.

"Today, according to my understanding, we have some accusations laid at our door. The bank is an infrastructure; we have hundreds of thousands of clients, and it is not realistic that every client and transaction can be monitored. So now we need to find out if there has been anything to cause doubts," he added.

Kitt added that the bank's deposits remain secure and that the main focus of the bank is servicing the Estonian people.

"Historically, there have also been a number of non-residents [accounts], because Estonia is a small, open economy country," Kitt added.

According to both Reuters and the Financial Times, the Swedbank flow of funds which came under suspicion chiefly originated from the bank's customers in Russia.

Danske Bank stopped taking on non-resident clients in 2015, it is reported.

As regards his own somewhat idiosyncratic situation, where he is released from work duties but remains on the Swedbank payroll, Kitt said that his contribution to the bank does not revolve around sitting at a desk, but around contributing.

Swedbank appointments in Estonia and Sweden.

"Where I carry out my tasks is not important," Kitt said. "It is logical that the situation has changed. It is quite right that when the chair of the board has changed, the new board chair will organize their own team," he continued.

Hansabank founder Jüri Mõis told business daily Äripäev, that in his 62 years he had never heard of Olavi Lepp – Kitt's temporary replacement in the CEO role. That said, Mõis also welcomed the fact that a back office risk manager had been appointed to the position

Hansabank was owned by Swedbank and rebranded as such in 2009.

An extraordinary meeting of Swedbank shareholders is to take place Wednesday, when former Swedish Prime Minister is expected to be elected supervisory board chair.

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Editor: Andrew Whyte



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