CEO of Oldest Bank in Sweden ‘Humbled’ by Laundering Allegations

Telegram från Bloomberg / Omni Ekonomi
06 mars 2019, 01.01

(Bloomberg) -- The chief executive officer of Swedbank AB says she realizes she needs to change her handling of money laundering allegations, after the case left her feeling “humble.”

Birgitte Bonnesen came under fire last month for appearing to mislead investors and the public. The 62-year-old CEO had repeatedly and energetically dismissed questions about Swedbank’s ties to the $230 billion Estonian dirty money scandal that’s engulfed Danske Bank A/S. But last month, she was forced to backtrack.

Swedbank has lost about a fifth of its market value since investors learned of the allegations in a Feb. 20 report by Sweden’s main broadcaster, SVT. The bank is accused of having handled almost $6 billion in suspicious funds tied to Danske’s Estonia case. Bill Browder, an investor known for chasing money launderers, says he has evidence supporting SVT’s reporting and that he plans to file a criminal complaint against Swedbank.

Browder was forced last month to correct a statement by Bonnesen, writing that her assurance to analysts that no complaint was pending was “not true.” His decision to file a complaint against Danske was followed by criminal investigations in the U.S. and elsewhere.

SVT also alleged that Swedbank provided services to some of the most notorious strongmen in the former Soviet Union, including deposed Ukraine President Viktor Yanukovych. The clash between Bonnesen’s earlier statements and the subsequent revelations left investors demanding greater transparency from Swedbank.

“I have had reason, after recent reporting in the media, to reflect on both a CEO’s communication and my own communicative style,” Bonnesen, who used to run Swedbank’s Baltic operations between 2011 and 2014, said in a phone interview on Tuesday.

“I realize that when you express yourself in the way that I often do, I need to provide more context, and I also realize that I need to be more vigilant regarding nuances,” she said. “This is an incredibly complex issue, and I cannot assume that the people who listen to me have the full context regarding Danske or others.”

Asked whether she thinks she should continue as CEO, Bonnesen said, “yes.”

Bonnesen said she doesn’t regret any of the comments she’s made in the past about money laundering, and that she doesn’t feel she has given any incorrect information, but acknowledged that she needs to work on her communication.

Swedbank is now being investigated by the financial regulators in Sweden and Estonia. Sweden’s state prosecutor has launched a separate probe to find out whether the bank broke insider information rules when it gave its biggest shareholders advance warning that the SVT program would air. The bank has denied wrongdoing.

Swedbank has also hired Forensic Risk Alliance (FRA) to conduct an external investigation into SVT’s claims. The bank had originally enlisted the help of EY, but was forced to drop the accounting firm, which is itself being investigated in Denmark for failing to spot suspicious dealings at Danske.

Bonnesen declined to comment on the specific allegations. “I’d like to wait until we get the result from that investigation,” she said, referring to the FRA review, which is due by the end of the month. Bonnesen said her bank is now cooperating fully with the relevant authorities.

To contact the reporters on this story: Niklas Magnusson in Stockholm at nmagnusson1@bloomberg.net;Hanna Hoikkala in Stockholm at hhoikkala@bloomberg.net

To contact the editor responsible for this story: Tasneem Hanfi Brögger at tbrogger@bloomberg.net

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