Swedbank CEO: Money laundering investigations not an existential threat

CEO of Swedbank Jens Henriksson
CEO of Swedbank Jens Henriksson Source: Swedbank

Swedbank's new CEO Jens Henriksson has made it a priority to solve problems arising from the money laundering scandal but refutes claims according to which investigations underway in USA and Europe are an existential threat to Sweden's oldest bank.

Henriksson, in office since early October, told Financial Times in an interview that both he and chairman of the supervisory board, former Swedish PM Göran Persson have met with competent US authorities but did not go into any more detail.

Swedbank Group's share has lost a third of its value since the scandal broke in February. Swedish public broadcaster SVT wrote about how Swedbank's Estonian arm moved over €135 billion of high-risk non-resident assets over more than 10 years.

"I would not call it an existential problem. It is a dark cloud hanging over the bank," Henriksson said, adding that he has consulted with heads of other banks facing similar money laundering investigations.

Denmark's leading lender Danske Bank has been hit hard by its money laundering scandal, with past goings-on at its Estonian branch currently investigated by authorities in USA, Denmark, Estonia and France. Ties between Danske's €200 billion scandal and Swedbank are the reason the latter is nor having problems.

Henriksson admitted that as a 200-year-old savings bank that relies on sustainability, it is hard to see headlines associating Swedbank with money laundering.

"It is hurting us. And I want to get past it. I want us to be as open and transparent as possible as concerns the past and become market leader in the future," he said.

Swedbank has introduced 132 initiatives to boost its ability of warding off financial crime, with 70 measures hoped to become operational by the end of the year.

Swedbank's €93 million internal investigation should be finished early next year, and the bank plans to publish the results. Swedbank has previously said the results of the in-house audit will not be made public.

Financial Times wrote in March that the New York State Department of Financial Services is looking at seven separate matters in connection with the Swedish bank. Some investors and analysts are worried whether the bank has enough capital to pay off a possible huge fine by US regulators.

Henriksson said the bank has solid finances but added that so far there are only allegations, which is why it is impossible to speculate over possible fine amounts.

The CEO talked to Financial Times during a time when Swedbank's net profit fell by 13 percent to €430 million in the third quarter – more than analysts had feared. Profits are down due to growing expenses tied to money laundering investigations.

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Editor: Marcus Turovski

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