Wednesday, June 22, 2016

FI-chief: Pointing to deficiencies in Nordea – Västerbotten Courier

Economy. Finansinspektionen (FI) takes the alarm about the deficiencies in Nordea’s cash reserve seriously, according to Director General Hans-Ole Jochumsen. At the same tone he down reports that the shortage could be as high as 80 billion.

Facts

in a secret memorandum prepared by the Finansinspektionen (FI) should there be evidence that large bank Nordea may need 50-80 billion in new capital.

the capital requirement is to bolster the bank faced the risks taken in lending to businesses.

Swedish Dagbladet has now published the memorandum.

at the same time FI’s annual review of banks’ capital requirements, which should be completed in September.

It looks authority including the terms of the loans and the risks of losses if Sweden would end up in a financial crisis.

According to FI s stability report in May, the authority concluded that Nordea meet current capital requirements with margin.

Sources: Finansinspektionen, Nordea, the Swedish newspaper Svenska Dagbladet

After the Swedish newspaper Svenska Dagbladet on Wednesday published the secret FI memo that describes how Nordea systematically underestimated the risks in their business lending was Erik Thedéen a flash summoned press conference.

– this is one of several indicating that this is an issue we should examine carefully, for it suggests that there are deficiencies in Nordea’s calculations of its capital, he said.

– it was just why, long before there was media attention, began a formal investigation by Nordea.

“sufficiently serious”

FI boss emphasize that the analysis in the memorandum is not incorrect, but it is made on the basis of incomplete data. Later calculations FI has made indicate that the amount of capital requirement for Nordea may increase with considerably lower.

– But it’s serious enough to do a survey, it consists, says Hans-Ole Jochumsen.

He would not give any figures on what “substantially lower” means the crowns.

HH: Underestimating Nordea risks in their business lending?

– We are not prepared to say something about it.

Nordea rejects

Nordea has strongly rejected the information contained in the memorandum. SvD’s disclosure on Monday has affected the share price of Nordea and aroused great hullabaloo.

Nordea’s President and CEO Casper von Koskull claimed the day after the bank does not need to draw in new capital in a rights issue. He stated capital requirement of the bank will be increased by approximately SEK 6 billion, but that Nordea has already taken the height of it.

FI-examination by Nordea will be ready in September.

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