Simplification of legal structure
Nordea has already been a Nordic bank for 15 years, and now it is time to change the legal structure to match that.
Nordea plans on merging its subsidiaries in Finland, Norway and Denmark with its Swedish parent company. This is part of the on-going simplification of our processes, which aims at harmonising the bank's operations and reinforcing Nordea's position to create the future relationship bank. With the merger, Nordea's banks in the Nordic countries form a strong single company, to the benefit of our customers.
Nordea is committed to a strong presence in all four Nordic countries, including Finland where Nordea operates locally across the country. Decisions will still be made close to the customer, as always.
Customer services and banking to remain unchanged
The merger is a legal procedure that will have no effect on our customers. All banking services will remain the same as before. Nordea has a wide range of local operations in Finland, and decisions will still be made close to the customer, as always.
Amount of deposits guaranteed will remain the same
Our customers' deposit guarantee and investors' compensation scheme will become subject to Swedish law. The amount of deposits guaranteed will remain the same as now at EUR 100,000.
Nordea's shareholders approved the merger plans at the Annual General Meeting held on 17 March 2016. The implementation of the plans depends on a satisfactory outcome of discussions with the authorities in each country. Nordea aims to complete the merger by early 2017.
All customers who have an account with Nordea received information on the simplification of the legal structure in the spring. After the merger in early 2017, Nordea's banking services in Finland will be provided by Nordea Bank AB (publ), Finnish Branch. Customers will receive the information either in their Netbank or by letter during the autumn. Questions and answers
In the new simplified legal structure, Nordea's customers' deposit guarantee will become subject to Swedish law. The amount of deposits guaranteed will remain the same as now at EUR 100,000. Within the EU, regulations governing deposit guarantees are based on the relevant directive.
Sweden implemented the Directive on Deposit Guarantee Schemes, which had already been enforced in Finland, in July 2016. The Swedish deposit guarantee of EUR 100,000 covers all deposits in one bank, including the deposits in the bank’s Nordic branches.
The Swedish deposit guarantee scheme is managed by the Swedish National Debt Office (Riksgälden). Further information on the deposit guarantee system in FinnishOpens new window
The EU's deposit guarantee authorities cooperate with each other, and if the deposit guarantee were ever to be activated, the Finnish deposit guarantee authority would handle the communication and the payment of compensation to Finnish depositors on behalf of the Swedish deposit guarantee authority.
The Finnish deposit guarantee scheme contains special protection for assets obtained from the sale of one's own residence, and it is valid for a fixed term of six months after the assets have been deposited. These deposits are compensated for in full if the depositor can reliably verify that the assets have been received from the sale of a residence.
Sweden introduced in July 2016 a similar deposit guarantee for assets exceeding EUR 100,000 received from the sale of one's own residence. However, the Swedish guarantee is more extensive and also covers many other situations in life during which customers may have an exceptional amount of money in their accounts. Such other situations covered by Swedish law include compensation for damage to housing, divorce, estate distribution and compensations arising from the termination of employment or from a sickness, disability or death. The exceptionally extensive guarantee applied in Sweden is valid for 12 months after the assets have been deposited.
Swedish law limits the maximum amount covered to five million Swedish krona for the sum exceeding the regular deposit guarantee (100,000 euros). The Swedish deposit guarantee authority may, however, approve raising this amount if the legislation of the country in which a bank's branch is located provides for a higher maximum amount. With regard to its Finnish Branch, Nordea Bank AB (publ) has filed a petition to the Swedish deposit guarantee authority for raising the guarantee for assets received from the sale of one's home to cover the full amount.
The Swedish deposit guarantee authority has ruled by a decision made on Nordea’s application in September 2016 that the depositors of the Finnish Branch have the right to a deposit guarantee for assets received from the sale of their residence equalling the deposit guarantee laid down in national legislation in Finland. The full deposit guarantee is valid for 6 months after the assets have been deposited. After this period, the raised deposit guarantee described above (EUR 100,000 + SEK 5m) complying with Swedish law will be applied to assets received from the sale of a residence for another period of 6 months.
In the new simplified legal structure, the investor compensations of Nordea's customers will be covered by Swedish law and the Swedish Investor Compensation Scheme.
In the Swedish Investor Compensation Scheme, the maximum compensation is SEK 250,000, which corresponds to EUR 26,441 (exchange rate as at 12 February 2016), whereas the maximum compensation in the Finnish Investors' Compensation Fund is EUR 20,000. Both the Finnish and Swedish schemes are based on an EU directive. The Swedish Investor Compensation Scheme is managed by the Swedish National Debt Office (Riksgälden).
The compensation in Finland covers the cash assets and financial instruments held by customers of investment and custody services who are classified as non-professional clients. The compensation in Sweden covers all customers of investment and custody services, except for investment service providers.Questions and answers about the investors' compensation scheme
Following the change in the legal structure, the main responsibility for the supervision of Nordea's operations in Finland will be transferred to the Swedish supervisory authority. The Finnish Financial Supervisory Authority will continue to supervise Nordea's operations in Finland in many ways either directly or in cooperation with the Swedish supervisory authorities. The Finnish Financial Supervisory Authority will also supervise compliance with Finnish law and the Finnish Financial Supervisory Authority's regulations in matters related to customer relationships.Questions and answers