Nordea Group has put an end to roughly six months of speculation by announcing its decision to re-locate its parent company from Stockholm, Sweden, to Helsinki, Finland.
The Nordic financial services group declared that it is considering moving its parent company away from Sweden in March in response to the Swedish government’s decision to raise the fees paid by banks and other credit institutions towards a fund established to guarantee stability in the event of a financial crisis.
The Swedish government ultimately caved in and effectively called off the raises, but failed to offset the benefits offered the banking union in the European Union.
Nordea highlights in its press release that re-locating its parent company to a country that is a member of the banking union will ensure it is subject to the same regulatory framework as banks and financial institutions domiciled in other parts of Europe. The decision on the re-location was made by the board of directors of Nordea in Copenhagen, Denmark, on Wednesday.
“The level playing field and predictable regulatory environment offered by the banking union are, we believe, in the best interests of Nordea’s customers, shareholders and employees,” explains Björn Wahlroos, the board chairman at Nordea.
Nordea has estimated that the resolution and deposit guarantee fees will increase by 60–150 million euros between 2017 and 2019.
The financial services group also estimates that the re-location will have an impact on neither its operations in the region, nor its day-to-day operations from a customer perspective. Similarly, only “a limited number of employees” will be affected by the parent company's re-location from Stockholm to Helsinki.
“Nordea will continue to be a major taxpayer in all four home markets,” it underlines.
The announcement was met with enthusiasm in Finland, despite the fact that the re-location is not expected to add notably to tax revenues.
Jan Vapaavuori (NCP), the Mayor of Helsinki, viewed that the re-location decision is evidence of the competitiveness of Helsinki and Finland. “We’re talking about a large bank here, and for it to arrive at come to such a conclusion is surely the sum of several factors,” he commented in an interview with Helsingin Sanomat.
Both Finland and its capital, he estimated, are able to compete against their larger regional rivals due to the safety, predictability and infrastructure reliability they offer. “[Stockholm and Copenhagen] are also considerably more international [than Helsinki]. That’s always a key factor in terms of foreign investment,” he said to the newspaper.
In Sweden, on the other hand, the announcement has fuelled criticism against the government and demands that the country join the banking union, reports YLE.
The Swedish Minister of Finance, Magdalena Anderson, stated yesterday in a news conference that the re-location decision is regrettable but cautioned against exaggerating its ramifications for the country. “I don’t think there has been any political pressure to fast-track Sweden into the banking union,” she stated according to the public broadcasting company.
Aleksi Teivainen – HT
Photo: Emmi Korhonen – Lehtikuva