Swedbank suffers drop in earnings in aftermath of money laundering scandal

By bne IntelliNews October 24, 2019

Swedbank’s profit fell 15.7% y/y to SEK4.66bn (€430mn) in the third quarter after the lender had to incur increased costs of dealing with the money laundering scandal in its Estonian branch, figures showed on October 23.

Swedbank’s branch in Estonia is suspect of handling up to €20bn worth of suspicious transactions, including from non-resident clients based in Russia. The shady transactions flowed between 2010 and 2015, it is alleged.

Apart from the internal investigation it is carrying out, Swedbank is also being probed by authorities in the US, Sweden, and the Baltic states over the allegations, which surfaced in the Swedish media early this year. 

Swedbank admitted to “historical shortcomings connected to the anti-money laundering work.”

The bank’s costs increased 29% y/y to SEK5.2bn in the third quarter, the bank said in its Q3 report. The rise in the costs was driven in part to “hiring more compliance staff and engaging two financial forensic firms as well as lawyers to deal with the investigations it faces,” according to Reuters.

Related Articles

Turkey colludes with Islamic State proxies says Macron as spat over block on Nato’s Baltic, Poland defence plans escalates

French President Emmanuel Macron on December 3 accused Turkey of colluding with Islamic State proxies on the opening day of Nato’s London summit at which officials were discussing how to deal ... more

Estonian ruling coalition hit by resignation of another far-right minister

Estonia’s Prime Minister Juri Ratas dismissed Mart Jarvik, Estonia’s minister of agriculture, on November 25, following controversy over a conflict of interest involving one of his advisers. ... more

Estonia’s far-right trade and IT minister resigns

Kert Kingo, Estonia’s minister of trade and IT, resigned on October 23 following accusations of lying to the parliament on the issue of hiring a controversial advisor. Kingo, who belongs to the ... more

Dismiss