Danske chairman to step down after money laundering scandal

COPENHAGEN: The main shareholder in Danske Bank A/S just made clear it won’t stand by and watch the chairman muddle through the lender’s biggest crisis in a century.

As Danske finds itself at the centre of one of Europe’s worst-ever money laundering scandals, AP Moller Holding A/S used its roughly 20% stake in the bank to force chairman Ole Andersen out.

The stunning announcement follows the 62-year-old Andersen’s failed attempt to win approval for his chosen candidate for chief executive officer. The sheer scale of Danske’s dirty money scandal, much of which overlapped with his tenure, also made Andersen’s continued presence untenable.

Robert Uggla, the CEO of AP Moller Holding, said Danske’s board had simply been “too slow” in dealing with the fallout of the laundering crisis. “We believe it was necessary to make a decision now,” he said on a conference call on Tuesday.

Shares in the bank opened as much as 3.8% up yesterday and traded at their highest level in about three weeks, after investors digested the news.

Danske has admitted that a large part of about US$230bil that flowed through a tiny Estonian unit was probably suspicious in origin. The bank is now the target of criminal investigations in several jurisdictions, including the US, and has reported multiple employees to the police.

The transactions at the centre of the scandal allegedly took place between 2007 and 2015. Andersen became chairman in 2011 and wasn’t due to step down until March next year.

Danske still hasn’t found a permanent chief executive officer to replace Thomas Borgen, who was removed from the bank last month for his role in the laundering scandal. Andersen had hinted in September that he would probably need to leave too, but said he wanted to stay on a bit longer to complete the “task” at hand. That task included finding a replacement for Borgen.

But Andersen’s protege, Jacob Aarup-Andersen, was rejected by the Financial Supervisory Authority last month. The reason given was that the 40-year-old head of Danske’s wealth unit essentially lacked the relevant experience.

AP Moller Holding wants Andersen, once a titan of Denmark’s corporate scene, to be replaced by Karsten Dybvad, who is the head of the Danish Confederation of Industry and is the same age as the outgoing chairman. The investor has demanded an extraordinary general meeting within two weeks to discuss the changes it says are needed.

Uggla said AP Moller Holding won’t interfere in the actual selection of a new CEO. The investor wants “to be a very active owner in Danske Bank, but it’s the job of the board to find a new CEO”, he said. Uggla also questioned whether Danske’s selection process was aligned with its interests.