Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Corporate Update (July 2016)
21 slides from Nordea Bank Abp's corporate update, Jul 20, 2016
Slide 1: Report regarding the investigation of Nordea Private Banking
20 July 2016 Report regarding the investigation of Nordea Private Banking Conclusions and actions
Slide 2: Internal Investigation of Nordea Private Banking in relation to the Offshore structures
Internal Investigation of Nordea Private Banking in relation to the «Offshore structures» Johan Ekwall, Acting Head of Group Compliance
Slide 3: Scope, involved parties and work streams
Scope, involved parties and work streams Scope for internal investigation • Nordea’s International Private Banking business, i.e. Nordea Bank S.A. in Luxembourg (NBSA) and a small number of customers within Nordic Private Banking • Focus on offshore structure customers administered by Mossack Fonsec
Slide 4: Fact sheet
Fact sheet KYC investigation on offshore structure customers • As of 15 April NBSA had 562 Offshore Structure Customers • KYC investigation covered all 129 NBSA customers related to Panama and Mossack Fonseca • 5 with beneficial owners resident in the Nordics • 29 with beneficial owner with a Nordic
Slide 5: Conclusions on Nordea Bank S.A. in Luxembourg (NBSA): General
Conclusions on Nordea Bank S.A. in Luxemburg (NBSA) General • Regular interaction 2010-16, including: Requests to open offshore structures on behalf of customers Relationship to Requesting Powers of Attorney Mossack Processing payments from customer’ accounts to MF Fonseca (MF) • No formal agr
Slide 6: Conclusions on NBSA: Quality of KYC files
Conclusions on Nordea Bank S.A. in Luxemburg (NBSA) Quality of KYC files • Overall, for the period 2010-16, the investigated KYC files (Know Your Customer) are clearly below required standards • Improvements in the latter part of the period • The majority of KYC files were high risk customers requir
Slide 7: Conclusions on NBSA: Tax compliance
Conclusions on Nordea Bank S.A. in Luxemburg (NBSA) Tax compliance • At the time of customer onboarding NBSA has had sufficient evidence of tax compliance in accordance with the Code of Ethics in 114 of the 137 offshore structures • When investigating how the structures have been used after being es
Slide 8: Conclusions on NBSA: Procedures for renewing Powers of Attorney
Conclusions on Nordea Bank S.A. in Luxemburg (NBSA) Procedures for renewing Powers of Attorney • Seven cases where Powers of Attorney or proxies were back dated • Illegal when it aims at altering the truth • However to be convicted for the criminal offence of forgery or of use of forgery, certain co
Slide 9: Conclusions on NBSA: Employees' ownership of offshore structures
Conclusions on Nordea Bank S.A. in Luxemburg (NBSA) Employees’ Ownership of offshore structures • The investigation has found two cases where employees in NBSA have owned off-shore structures, both of them closed more than five years ago • No other private engagements among Private Banking employees
Slide 10: Mannheimer Swartling's two assignments
Mannheimer Swartling’s two assignments Assignment No. 1 A separate review in order to conclude how the management and the Board of Nordea Bank S.A. Luxembourg (“NBSA”) have managed their duties in relation to the operations of offshore structures from a governance and risk management perspective in
Slide 11: Assignment No. 1 – The Review
Assignment No. 1. Assignment No. 1 – The Review General background with regard to Luxembourg A separate review in order to and the Offshore Operations conclude how the management and the Board of NBSA have managed their duties in relation to the operations of offshore structures Conclusions with reg
Slide 12: Conclusions on Board and Executive Management awareness of offshore structure risks
1. Conclusions on to what extent the Board and the Executive Management of NBSA were aware of the operations associated with Offshore Structures and the risks related thereto Throughout the Relevant Period, the Board and the Executive Management of NBSA have been aware that NBSA’s business include
Slide 13: Conclusions on identified risks versus business strategy and Risk Appetite Framework
2. Conclusions on how identified risks have corresponded to the business strategy and Risk Appetite Framework of NBSA The aim of the business strategy of NBSA has been to meet the increasing regulatory demands concerning transparency and to comply with legal requirements in relation to AML Issues
Slide 14: Conclusions on communication of offshore operations to the Group
3. Conclusions on to what extent the operations associated with Offshore Structures have been communicated to the Group Nordea Group has, through certain individuals, been aware that NBSA’s business includes operations associated with Offshore Structures since • the Board of NBSA has consisted of
Slide 15: Overall conclusions on the governance of NBSA
4. Overall conclusions on the governance of NBSA The NBSA Board and Executive Management minutes are brief and contain little or no details on deliberations, due to which it is difficult to get a good understanding and overview of the matters discussed in the NBSA Board and Executive Management me
Slide 16: Overall conclusions on the governance of NBSA; cont.
4. Overall conclusions on the governance of NBSA; cont. Although the Executive Management of NBSA has been aware of risks relating to AML Issues and Tax Issues, it has failed to link these risks to the operations associated with Offshore Structures. In view of the result of the Investigation, a fa
Slide 17: Mannheimer Swartling's assignment No. 2 – The Statement
Mannheimer Swartling’s assignment No. 2 Assignment No. 1 – The Statement Advisor during the independent internal investigation carried out by Group Compliance and Group Operational Risk to confirm high professionalism in defining the scope, A statement to this effect methodology, structure and docum
Slide 18: Casper von Koskull, President and CEO
Casper von Koskull President and CEO
Slide 19: Decisive measures to mitigate deficiencies
Decisive measures to mitigate deficiencies In summary 1. Nordea will promptly implement all the recommendations in the report 2. Stricter governance of Nordea Bank in Luxembourg (NBSA) by integrating NBSA into Nordea Group 3. Nordea has blocked accounts where deficiencies were found 4. NBSA will enf
Slide 20: Compliance the top priority – a norm based approach
Compliance the top priority – a norm based approach • Compliance must be effective in an environment where both regulation and our stakeholders’ attitudes and values evolve over time • The Ethics & Values Committee. An operational function that will proactively work to develop key policies and strat
Slide 21: Strengthening the compliance organisation
Strengthening the compliance organisation • Recruited world-class people to key positions • Built group-wide operations for critical processes • Established a separate Financial Crime Change Programme (FCCP) • 850 full-time employees focusing on activities related to KYC, sanctions screening and tra