Bank Museum

Nordea's history

Nordea's history in Finland begins with the establishment of the Union Bank of Finland, the first commercial bank in the country. The Senate approved the bank's license on 21 May 1862 and the bank began its operations in July the same year. 

Photo: Union Bank of Finland, Kuopio, 1897.

In total, Nordea's family tree in Finland consists of 25 commercial banks. Finnish family tree includes three other main banks in addition to the Union Bank of Finland: Kansallis-Osake-Pankki, Helsingin Osakepankki and Suomen Työväen Säästöpankki (STS-pankki). Finland's first savings bank is also part of Nordea's history as the successors of the branches of Savings Bank of Turku were merged with the Union Bank of Finland when it acquired Suomen Säästöpankki in 1993. Though this, Nordea's oldest roots date back to 1822 in Finland.

The Union Bank of Finland and Kansallis-Osake-Pankki merged in 1995. They formed a new bank called Merita, but another merger was just around the corner. In 1998, Merita and the Swedish Nordbanken merged establishing the MeritaNordbanken Group.

Photo: Signing of the MeritaNordbanken merger agreement on 13 October 1997. Photographed by Ilkka Leino.

 

The new name Nordea was adopted in the late 2001. At the time, the Danish Unibank and the Norwegian Christiania Bank og Kreditkasse had also joined the Group.

In Scandinavia, Nordea's predecessor banks include some of the oldest banks in the Nordic countries, such as Sparekassen for Kjobenhavn og Omegn (Denmark, founded in 1820), Wermlandsbanken (Sweden, founded in 1832) and Christiania Kreditkasse (Norway, founded in 1848).

Union Bank of Finland

The Union Bank of Finland (UBF) was established during a time when political tensions eased and there was more freedom to conduct a business, which contributed to the transformation of the Finnish economy. At the time, there was no Limited Liability Companies Act or banking laws in Finland, so the establishment of the bank was modelled after other countries.

The purpose of founding the Union Bank of Finland was to finance agriculture, industrial production and trade as well as to manage payment traffic. The bank had rented four rooms for its head office in the House of Nobility and began its operations there in July 1862.

Photo: Union Bank of Finland, 1890s.

In the same year, the bank expanded its operations by opening seven branches and three customer service offices. Branches were set up in towns where at least 2,000 banking shares had been subscribed for. These included Vyborg, Loviisa, Turku, Kuopio, Hämeenlinna, Tampere and Vaasa. Porvoo, Mikkeli and Oulu had to settle for customer service offices. The first branch started off as one-man operations, as banking was usually a secondary activity for the bank manager.

 

In the early 1870s, competition for the Union Bank of Finland began to appear. The most significant competitor early on was Nordiska Aktiebanken för Handel och Industri (Pohjoismaiden Osakepankki Kauppaa ja Teollisuutta varten), which was founded with German capital and headquartered in Vyborg. The Union Bank of Finland and Nordiska Aktiebanken merged in 1919. The bank created as a result of the merger was called Pohjoismaiden Yhdyspankki. In 1975, the bank re-adopted its original name.

Photo: Nordiska Aktiebanken, Heinola, 1914.

Kansallis-Osake-Pankki

The foundation for establishment of Kansallis-Osake-Pankki (KOP) was laid in the spring of 1889, when Fennomans gathered at the Helsinki Finnish Club with the aim to make banking services available in Finnish. In order to raise equity capital for the new bank, the Fennomans recruited advocates who collected names to share registers in secret meetings. As a result, a total of 1,152 people entered shares in the register.

The bank began its operations on Saturday 8 February 1890 as it opened its branch at Aleksanterinkatu 17. In the early stages, creating a Finnish banking vocabulary proved especially challenging since the previously founded banks offered services in Swedish only.

Photo: Kansallis-Osake-Pankki, Mänttä, 1956.

Although Kansallis-Osake-Pankki only stared off with one branch for banking license reasons, its goal from the start was to become a national operator. After a few months' delay, the bank opened branches in Turku, Hamina, Tampere, Viipuri and Oulu. The bank continued to expand its branch network and branches began to pop up in rural areas, too. In the late 1800s, Kansallis-Osake-Pankki had established branches in Hämeenlinna, Kuopio, Pori, Kemi, Käkisalmi, Heinola, Iisalmi, Mikkeli, Rauma, Vaasa, Kajaani, Raahe, Rovaniemi, Maarianhamina, Salo, Joensuu, Jyväskylä, Lahti, Hanko, Porvoo, Savonlinna and Nurmes.

By 1913, Kansallis-Osake-Pankki had become the second largest commercial bank in Finland. From then onwards, the two banks, Kansallis-Osake-Pankki and the Union Bank of Finland, competed for the title of the largest bank in the country for decades.

Photo: Kansallis-Osake-Pankki, Urho Kekkosen katu, Helsinki, 1975.

Helsingin Osakepankki

Helsingin Osakepankki (HOP) was established in 1912 and first opened its doors to the public on 2 January 1913. Originally, banker Emil Winckelmann negotiated funding for the bank with Marcus Wallenberg, Manager of the Swedish Enskilda Banken. As a result, the bank was founded, and Winckelmann became the bank's first manager. The good industrial growth outlook in Finland at the time most likely explains Wallenberg's interest in such an investment.

Photo: Nylands Aktiebank, Helsinki, 1910s.

The history of Helsingin Osakepankki was characterized by a number of mergers with small local commercial banks. As a result of the mergers, this local bank that originated from Helsinki grew into a national wide commercial bank. Many of the acquired banks were operating in the Swedish-speaking coastal regions, which strengthened Helsingin Osakepankki's position among Swedish-speaking customers.

Photo: Helsingin Osakepankki, an accounting department, 1964.

The history of Helsingin Osakepankki include many colorful turns. There was speculation with stocks and attempts to take over the bank as early as in the 1910s. In the mid-1980s, Helsingin Osakepankki got into financial trouble, which attracted gamblers and corporate raiders. Many parties got their hands on the bank's shares but the main competition was finally between Säästöpankkien Keskus-Osake-Pankki and the Union Bank of Finland. Helsingin Osakepankki became the Union Bank of Finland's subsidiary on 31 December 1985 until the merger was officially completed at the end of October in 1986. The personnel of Helsingin Osakepankki began to work for the Union Bank of Finland under their previous employment contracts and on their previous salaries.

Family tree

You can see Nordea's history in Finland illustrated in the chart. Click the image to enlarge the chart.

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Abbreviations used for the banks:

• Helsingin Osakepankki = HOP ja Helsinginpankki
• Kansallis-Osake-Pankki = KOP ja Kansallispankki
• Pohjoismaiden Osakepankki Kauppaa ja Teollisuutta varten = Pohjoismaiden Osakepankki
• Suomen Yhdyspankki = SYP and Yhdyspankki / The Union Bank of Finland (UBF). From 1919 to 1975 the bank's name was Pohjoismaiden Yhdyspankki (PYP)

Further information about Nordea's history

If you want to read more about history of Nordea's predecessor banks in Finland, see the reading list below. The most recent book Erehtymättömät by Markku Kuisma and Teemu Keskisarja, was published in 2012.

Books about the bank's history:

• Blomstedt, Yrjö. 1989. Kansallis-Osake-Pankin historia I: 1889-1939. Helsinki, Kansallis-Osake-Pankki.
• Ginström, Egidius. 1962. Helsingin Osakepankki puolen vuosisadan taipaleella. Helsinki, Oy Tilgmann Ab.
• Heikel, Felix. 1922. Pohjoismaiden Osakepankki Kauppaa ja Teollisuutta varten 1872-1919. Helsinki, Holger Schildtin kirjapaino.
• Kuisma, Markku. 2004. Kahlittu raha, kansallinen kapitalismi. Kansallis-Osake-Pankki 1940-1995. Helsinki, Suomalaisen Kirjallisuuden Seura.
• Kuisma, Markku & Keskisarja, Teemu. 2012. Erehtymättömät. Tarina suuresta pankkisodasta ja liikepankeista Suomen kohtaloissa. Helsinki, WSOY.
• Lyytinen, Eino. 1983. Työväen pankki. STS ja sen edeltäjät 1909-1984. Helsinki, Tammi.
• Pipping, H. E. 1962. Sata vuotta pankkitoimintaa. Helsinki, Frenckellin Kirjapaino Osakeyhtiö.
• Soukola, Timo. 2008. Sallitun riskinoton rajat. STS-pankki ja sen edeltäjät 1980-1992. Porvoo, WS Bookwell.
• Tudeer, Erik. 1986. Helsingin Osakepankki 1913-1986. Espoo, Frenckellin Kirjapaino Oy.
• Vihola, Teppo. 2000. Rahan ohjaaja. Yhdyspankki ja Merita 1950-2000. Merita Pankki Oyj. Jyväskylä, Gummerus Kirjapaino Oy.

The documentary series Kasvun rahoittajat by Franck Media also tells the history of Nordea and Finnish commercial banks.