Nordea

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File:Nordea old logo.svg
Nordea old logo (2000–2016)

Nordea Bank Abp,<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref><ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> commonly referred to as Nordea, is a Nordic<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref><ref>Template:Cite news</ref> financial services group operating in northern Europe with headquarters in Helsinki, Finland.<ref name=":8">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The name is a blend of the words "Nordic" and "idea".<ref name=":1">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The bank is the result of the successive mergers and acquisitions of the Finnish, Swedish, Danish, and Norwegian banks of Merita Bank, Nordbanken, Unidanmark, and Christiania Bank og Kreditkasse that took place between 1997 and 2001.<ref name=":1" /> The Nordic countries are considered Nordea's home market, having finalised the sales of their Polish bank in 2014, Baltic operations in 2019<ref name=":2">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> and completed the exit from Russia in early 2022 following a 2019 decision to close the business there.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Nordea is listed on Nasdaq Nordic exchanges in Helsinki, Copenhagen, and Stockholm and Nordea ADR is listed in the US.<ref name=":2" />

Nordea serves 9.3 million private and 530,000 active corporate customers, including 2,650 large corporates and institutions.<ref name=":2" /> Nordea's credit portfolio is distributed across Finland (21%), Denmark (26%), Norway (21%), and Sweden (30%).<ref name=":2" /> There are four Business Areas (BAs) at Nordea, Personal Banking, Business Banking, Large Corporates & Institutions, and Asset & Wealth Management. Assets under Management (AUM) were €411 billion in December 2021.<ref name=AR>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

Nordea has been designated as a Significant Institution since the entry into force of European Banking Supervision in late 2014, first as the Finnish arm of the Stockholm-based group and since 2017 as a financial holding company. As a consequence, it is directly supervised by the European Central Bank.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref><ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

The company has been embroiled in numerous scandals involving moneylaundering and tax evasion. In 2024, Danish authorities indicted the bank for the most extensive violation by a bank of Denmark’s anti-money laundering act in the country's history.<ref name=":13">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

HistoryEdit

Nordea's roots date to 1820 and Sparekassen for Kjøbenhavn og Omegn in Denmark, and a complete family tree of around 300 banks including some of the oldest banks in the Nordic region.<ref name=":1" /> This includes Wermlandsbanken of Sweden (founded 1832), Christiania Kreditkasse of Norway (founded 1848) and Union Bank of Finland (UBF) of Finland (founded 1862). Between 1997 and 2001, the Finnish, Swedish, Danish, and Norwegian banks of Merita Bank, Nordbanken, Unidanmark, and Christiania Bank og Kreditkasse merged into the present day Nordea.

Merita Group was formed in 1995, when UBF and Kansallis-Osake-Pankki (KOP) merged.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> UBF was established, in 1862, at a time when there were no Limited Liability Companies Act or banking laws in Finland.<ref name=":3">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Therefore, it was modelled after banking standards in other countries. UBF eventually merged with rivals Nordiska Aktiebanken in 1919 and Helsingin Osakepankki (HOP) in 1986. KOP was originally founded in 1890 with its first branch at Aleksanterinkatu 17, in Helsinki.<ref name=":3" /> By 1913, KOP had become the second largest commercial bank in Finland. The two banks, KOP and UBF, competed for the title of the largest bank in Finland for decades.<ref name=":3" /> KOP suffered large credit losses as a result of the Finnish banking crisis in the early 1990s. On 1 April 1995 it became a subsidiary (51%) of Merita Group in a direct share issue.

Nordbanken was formed in 1986 by a merger of two smaller private local banks, Uplandsbanken and Sundsvallsbanken, though it was the product of numerous original institutions.<ref name=":4">Template:Cite book</ref> The oldest of the original Nordbanken constituent banks was Wermlandsbanken, which was founded in 1832. Nordbanken came under Swedish government control in 1992, following the Swedish banking crisis in the early 1990s,<ref name=":4" /> with the sale of its non-performing loans to the Swedish government and significant reduction in personnel.<ref name=":5">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Bad debts were transferred to the asset-management company Securum, which sold off the assets.<ref name=":5" /> At the time, the approach of establishing "good" and "bad" banks composed of corresponding assets was a novel resolution approach.

Merita Group merged with Nordbanken in 1997 forming MeritaNordbanken.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The Solo internet-based banking operation of MeritaNordbanken was a global pioneer and leader providing mobile and internet banking access in 1999.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The bank reached 1 million internet banking customers during 1999 with 3 million log-ins and 3.7 million payments per month.<ref name=":6">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Housing loans via Solo were introduced in 1999.<ref name=":6" /> MeritaNordbanken agreed to buy Unidanmark, Denmark's second-largest bank, in early 2000 creating the Nordic region's biggest financial institution with €186 billion in assets.<ref name=":7">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The merged group had a banking market share of 20% in Sweden, 25% in Denmark and 40% in Finland and a combined workforce of 28,050.<ref name=":7" /> By end 2000, MeritaNordbanken had further merged with Christiania Bank og Kreditkasse of Norway, a process started in 1999 and changed its name to Nordea.<ref name=":6" /> Christiania Bank had also been impacted severely during the banking crisis in the early 1990s, with Nordea acquiring the bank from the Norwegian Government Bank Investment Fund with a 35% share.<ref name=":4" /><ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

Nordea expanded into Poland, the Baltics and Russia in the early 2000s, with 2% of total revenues from the Poland and Baltics region.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Nordea divested its Polish banking operations in 2013, with the sale to PKO Bank Polski for €694 million but retains a presence in Poland via operations and IT units supporting the Nordic banks.<ref name=":10">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref><ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> By end 2014, lending in the Baltics was €8.2 billion and in Russia €4.5 billion.<ref name=":10" /> During the period 2013-2017 exposure to the Russian market was reduced by 63%.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> In 2016, Luminor was formed by a merger of Nordea's and DNB's operations in Estonia, Latvia and Lithuania creating the third largest Baltic regional bank with assets of €15 billion and a market share of 16.4%.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref><ref name=":11">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Luminor was sold to Blackstone, with Nordea and DNB retaining each initially a 20% share.<ref name=":11" /> However, the full divestment was completed in 2019.<ref name=":2" /> Exit from the Russian, Baltic and Polish markets were part of Nordea's de-risking strategy, which also included reduced exposures to some sectors (e.g. Shipping, Oil & Offshore and Agriculture in Denmark).<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Nordea was one of the Nordic banks, including Danske Bank, SEB and Swedbank, allegedly involved in the money laundering scandal, involving ex-Soviet states, that emerged in 2017.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

Nordea announced plans to move its corporate headquarters from Stockholm, Sweden to Helsinki, Finland in September 2017.<ref name=":12">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The re-domiciliation of Nordea to Finland put it within the supervision of the European Central Bank and within the European Union's banking union.<ref name=":8" /><ref name=":12" /><ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> In October 2018, Nordea completed the move of its corporate headquarters to Helsinki, Finland.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

Historical performance, ratios and key figures for Nordea 1999-2023
Year Share Price (€, year-end) Total Assets (€ billion) Return on Equity (%) Tier 1 Capital Ratio (%) Common Equity Tier 1 capital ratio (%), excluding Basel 1 floor
1999 5.84 186 18.0 9.0
2000 8.10 224 16.1 6.8
2001 5.97 242 13.8 7.3
2002 4.20 250 7.5 7.1
2003 5.95 262 12.3 7.3
2004 7.43 276 15.7 7.3
2005 8.79 326 18.0 6.8
2006 11.67 347 22.9 7.1
2007 11.42 389 19.7 7.0 7.5
2008 5.00 474 15.3 7.4 8.5
2009 7.10 508 11.3 10.2 10.3
2010 8.16 580 11.5 9.8 10.3
2011 5.98 716 11.1 10.1 11.2
2012 7.24 677 11.6 11.2 13.1
2013 9.78 630 11.0 14.9
2014 9.68 669 11.5 15.7
2015 10.15 647 12.2 16.5
2016 10.60 616 12.3 18.4
2017 10.09 582 9.5 19.5
2018 7.27 551 9.7 15.5
2019 7.24 555 5.0 16.4
2020 6.67 552 7.1 17.1
2021 10.79 570 11.2 17.1
2022 10.03 595 11.8 16.4
2023 11.23 585 16.9 17.0
2024 10.50 623 16.7 15.8

Performance and ownershipEdit

Nordea’s market capitalisation was €36.8 billion at the end of 2024, making it the seventh largest company in the Nordic region and among the 15 largest European financial services groups.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Between 2000 – when Nordea was formed by the merger of MeritaNordbanken and Unidanmark – and 2024, the share price of Nordea appreciated by 159%, outperforming the STOXX Europe 600 Banks Index (-37%).<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

At the end of 2024, Nordea had more than 600,000 shareholders. Nordea’s 10 largest shareholders were:<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

  1. BlackRock, 5.1%
  2. Norges Bank, 5.0%
  3. Nordea-fonden, 4.4%
  4. The Vanguard Group, 3.9%
  5. Cevian Capital, 3.8%
  6. Alecta Tjänstepension, 2.1%
  7. Swedbank Robur Funds, 2.0%
  8. SEB Funds, 1.3%
  9. Varma Mutual Pension Insurance Company, 1.1%
  10. Nordea Funds, 1.1%

Business areasEdit

There are four Business Areas (BAs) at Nordea, Personal Banking, Business Banking, Large Corporates & Institutions, and Asset & Wealth Management.

ScandalsEdit

Nordea was the subject of an online phishing scam in 2007. The company estimated 8 million kr ($1.1 million) was stolen.<ref name=":0">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Customers were targeted over a period of 15 months with phishing emails containing a trojan horse.<ref>Template:Cite news</ref> Nordea refunded affected customers.<ref name=":0" />

The largest financial group in the Nordic region, Nordea was, despite warnings from the Swedish Financial Supervisory Authority (FI) active in using offshore companies in tax havens according to the Panama papers.<ref name="mordea">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> Other Swedish banks were mentioned in the documents, but mention of Nordea occurred 10,902 times and the second-most mentioned bank has 764 matches.<ref name="SvdVeta3">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> In 2012, Nordea asked Mossack Fonseca to change documents retroactively so that three Danish customers power of attorney documents had been in force since 2010.<ref name="mordea" /> Nordea bank loaned billions of euros to shipping companies that own vessels in secrecy jurisdictions such as Bermuda, Cyprus, Panama, BVI, the Cayman Islands and the Isle of Man. In the Paradise Papers, Nordea was shown to have lent a significant amount of money to customers based in tax havens.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> As a consequence of the leaked documents, the Swedish Financial Supervisory Authority (FI) stated on 4 April 2016 that it had started an investigation into the conduct of Nordea.

The Nordea section in Luxembourg, between the years 2004 and 2014, founded nearly 400 offshore companies in Panama and the British Virgin Islands for its customers.<ref name="mordea"/> The Swedish Financial Supervisory Authority (FI) pointed out that there are "serious deficiencies" in how Nordea monitors money laundering, and gave the bank two warnings. In 2015, Nordea paid the largest possible fine - over 5 million EUR.<ref name="mordea" /> Stefan Löfven, Prime Minister of Sweden, said in 2016 that he was very critical of the conduct of Nordea and its role, and said: "They are on the list of shame too".<ref name="GpSkams">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The Swedish minister of Finance Magdalena Andersson characterized the conduct of Nordea as "a crime" and "totally unacceptable".<ref name="local-nordea">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref><ref name="yle-nordea">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The director for Nordea Private banking Thorben Sanders admits that before 2009 they did not screen for customers that tried to evade tax. "At the end of 2009 we decided that our bank should not be a means of tax evasion" says Thorben Sanders.<ref name="mordea" /> Nordea CEO Casper von Koskull stated that he was disappointed with the shortcomings within Nordea's operating principles, saying that "this cannot be tolerated".<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

In 2013, Politiken, a Danish newspaper, revealed that Nordea's Copenhagen branch was instrumental in establishing approximately 100 offshore companies for Russian and other nationals, despite warnings about suspicious activities. In 2024, the Danish authorities indicted Nordea for violating anti-money laundering laws by allowing $3.7 billion of suspicious transactions by the Russian clients. According to the Danish authorities, it was most extensive moneylaundering ever committed by a financial company in the country.<ref name=":13" />

In March 2019, public service broadcasting company, Yle, aired a program that revealed money laundering allegations against Nordea.<ref>Template:Cite news</ref> The company was the biggest Nordic lender allegedly involved in the multi-million-dollar money laundering scheme, according to Bloomberg.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

In July 2024, Nordea Bank was taken to court in Denmark over allegations of failing to prevent money laundering linked to Russian clients. The charges stem from transactions worth €3.8 billion, where Nordea is accused of neglecting proper oversight and ignoring red flags. Despite setting aside €95 million for potential fines, the actual penalty could be significantly higher, possibly approaching $1 billion.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref><ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

In August 2024, Nordea agreed to pay $35 million to settle a money-laundering investigation by the New York State Department of Financial Services, linked to the Panama Papers scandal. The probe revealed the bank's failure to prevent illegal activities, including inadequate screening of clients from 2008 to 2019.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

SubsidiariesEdit

Following a major structural reorganisation, Nordea consolidated its Nordic operations into branches of the parent company. The following is a list of former subsidiaries and other historical entities.

Nordea Bank Abp (Finland) – headquartered in Helsinki

Former Subsidiaries (now branches of Nordea Bank Abp)Edit

  • Denmark – formerly Nordea Bank Danmark A/S
  • Norway – formerly Nordea Bank Norge ASA
  • Sweden – formerly Nordea Bank AB

Divested or Closed EntitiesEdit

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See alsoEdit

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Nordic headquartersEdit

ReferencesEdit

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External linksEdit

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