Nordea Sinks as Investors Fear More Money Laundering Allegations
(Bloomberg) -- Nordea Bank Abp sank as much as 6.5 percent on Monday ahead of report due to be broadcast this afternoon that will focus on the biggest Nordic lender's alleged involvement in money laundering.
The news appeared to drag down a number of other Nordic bank shares with DNB ASA, Norway's largest lender, falling as much as 4.6 percent. SEB AB fell as much as 2.1 percent.
Read More: Blackstone Deal Gives Nordea, DNB a Path Out of the Baltics
The development shows how much investors have started to fear more revelations that the Baltic units of banks in Sweden, Finland, Denmark and Norway may have served as a hub for Russian criminals eager to channel their funds into the West. Danske Bank A/S is currently under investigation by the U.S. Justice Department and the Securities and Exchange Commission after admitting that it was at the center of a $230 billion Estonian dirty money scandal.
Read More: Browder Raises Nordea Laundromat Allegations to $405 Million
Swedbank AB, Sweden's oldest lender and the dominant financial presence in the Baltics, has lost about a fifth of its market value since the main Swedish broadcaster, SVT, published a report on Feb. 20 linking it to the Danske case. The bank, which had previously denied any wrongdoing, is now being investigated by the financial supervisory authorities of Sweden and Estonia.
“Investors are essentially left in the dark with regard to Nordic banks, waiting to see what and when new allegations will emerge on money laundering,” said Philip Richards, an analyst at Bloomberg Intelligence in London.
“The issue has now moved on from Danske Bank to engulf Swedbank and Nordea, but the entire sub-sector appears to be getting drawn in,” Richards said. “Until banks come clean and reveal the full extent of what suspicious transactions they have been involved in, this looks set to run and run.”
Nordea said it “is aware of the media story and has been in dialogue” with the Finnish broadcaster YLE and the Danish newspaper Berlingske, which are intending to publish the laundering report later on Monday.
“We have not yet seen the program or article. Based on what we have been invited to comment on, these are all issues that we have seen and commented on before and are therefore in line with previous statements made on AML issues,” Nordea spokeswoman Kati Tommiska said in an emailed statement.
The bank, which moved its headquarters to Finland from Sweden for regulatory reasons last year, has already been fined in the past by Swedish authorities for failing to live up to anti-money laundering rules. The bank has repeatedly said it is cooperating with the relevant authorities.
Most recently, investor Bill Browder brought a complaint against Nordea alleging the bank is tied to the Danske scandal. Finland's prosecutor is looking into the case, and has yet to announce any decision on whether it thinks an investigation is warranted.
The Laundering Report
Finnish broadcaster YLE will show its viewers a program about Nordea and money laundering on Monday afternoon, according to its website.
- The program is said to be about a big information leak showing that hundreds of millions of euros from suspicious sources have moved through Nordea: YLE
- OCCRP is also planning to publish information on Monday
- Nordea's CEO Casper von Koskull will take part in another YLE program covering money laundering at 9pm Finnish time
- DNB spokesman Even Westerveld says the Norwegian bank hasn't been contacted by YLE
- NOTE: YLE's MOT program has previously aired documentaries on Nordea involving so-called Paradise Papers and Panama Papers, though it's unclear what the content of today's program is
- Feb. 19: Nordea Laundering Review Handed to Police as FSA Completes Work
- Feb 22: Nordea Laundering Allegations Are Now Being Reviewed in Finland
- Feb. 22: Nordea Is Cooperating With Investigators Amid Fresh Allegations
- Feb. 25: Browder to Take Nordea Laundering Claims to U.S. If Needed
--With assistance from Jonas Cho Walsgard, Frances Schwartzkopff and Jonas Bergman.
To contact the reporters on this story: Hanna Hoikkala in Stockholm at hhoikkala@bloomberg.net;Kati Pohjanpalo in Helsinki at kpohjanpalo@bloomberg.net
To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net, Tasneem Hanfi Brögger, Niklas Magnusson
©2019 Bloomberg L.P.
-
Talking Points This Week: Tech Nerves, FII Buying, And A Faraway Banking Shock
The global markets are not shining this Diwali. The exception in the large markets is, India.
-
Midterm Rally Lasted A Day. The Hard Reality Of A Divided US May Last Two Years | Opinion
Between a contested AI boom, a debt ceiling that arrives in 2027 and a president with every incentive to act alone, the next two years may prove more volatile than the first day's rally suggests.
-
Blue Wave Will Derail the AI Trade but Won't Dismantle the AI Era | Unhedged Position
The Democrats' sweep of the US Congress will see politics collide with economic forces both over the long and short term.
-
It's Time To Take The GST Council's Bet On Trust Global
Payment records can prove India's services exports, and clear, proportionate rules can bring foreign digital sellers into the tax net.
-
Opinion | India at 38: From Innovation Overperformer to Innovation Powerhouse
India now has 453 VC-backed deep science startups, 18 of them late-stage, after 117 percent growth since 2020. Laurus Labs, at USD 9.3 billion, is the most valuable deep science company in any middle-income economy outside China.
-
Navigating Energy Crossroads: S Jaishankar's Call For Diversified Supply Chains At G20 Ministerial Meeting
As geopolitical fault lines continue to test maritime trade routes and commodity flows, Jaishankar's message remains pertinent: true economic resilience requires open markets, protected transit lines, and a genuine commitment to multilateral cooperation rather than coercion.
-
Indians Are Travelling, But Not Every Journey Is A Holiday | The Week In Whys
Pilgrims, patients and working women are the real travellers, and the system hasn't quite caught up with them.
-
Getting To Work Costs Women More | The Reason Why
It is not just about women paying more than men. It is about women paying much more in cities than in villages.
-
AI Bias In Investing Cannot Be Eliminated, But It Can Be Governed
Framing is a particularly important example as identical financial information presented in terms of gains rather than losses can lead an LLM to reach a different assessment.
