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The
case, which the Danish financial services authority called "very
serious", is another blow to the reputation of Denmark's biggest
bank which is trying to limit the fallout from its involvement
in a major money laundering scandal.
The dismissal of Nielsen, who headed the bank's domestic banking
activities and served as interim CEO until the end of last
month, was the first major change since Chris Vogelzang took
charge at the start of June.
"Every single day, we must strive to ensure that we offer our
customers proper advice and products that suit their needs,"
said former ABN AMRO banker Vogelzang in a statement.
"As a result of misguided management decisions, we failed to do
so in this specific matter, and for this we offer our
apologies," he added.
Danske is separately under investigation in the United States
and several other countries for payments totaling 200 billion
euros ($228 billion) through its small Estonian branch, many of
which the bank said were suspicious.
Danske will compensate around 87,000 customers who invested in
the Flexinvest Fri product for a total of around 400 million
Danish crowns ($61 million). Its shares traded 2.2% lower by
0900 GMT and have lost around a fifth of their value this year.
"Overall the charge is an unhelpful one-off at a time when
public perception of the franchise remains in the spotlight,"
said KBW analysts in a note.
The fees for the product were raised in connection with the
implementation of the MiFID II financial industry regulation in
2017.
"He (Nielsen) was at the time one of the responsible Executive
Board members who did not to a sufficient degree ensure that the
Flexinvest Fri product was suitable for the bank's customers,"
Chairman Karsten Dybvad said in a statement.
"Therefore, we find that Jesper cannot continue in his
position," added Dybvad, who took up his role last year.
The Danish FSA said in had been investigating the case for some
time and expected to make a decision on it by late summer.
"On the basis of the information available, this is a very
serious matter," said Jesper Berg, who heads the Danish FSA.
Nielsen served as interim CEO from last October after former
chief executive Thomas Borgen resigned when the scope of money
laundering case emerged from an internal investigation.
($1 = 0.8782 euros)
($1 = 6.5580 Danish crowns)
(Reporting by Stine Jacobsen and Jacob Gronholt-Pedersen;
Editing by Edmund Blair/Keith Weir)
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