Push or jump? Danske Bank CEO exits suddenly over money laundering scandal
03 Oct 2018

In a u-turn, Danske Bank has announced the immediate departure of CEO Thomas F. Borgen, just days after it said he would remain with the bank until a new CEO was appointed.

Indications are Borgen would have preferred to stay on longer but was forced to quit immediately.

He will be replaced by executive board member Jesper Nielsen, who is also the Head of Banking DK, until a permanent CEO is appointed.

Nielson is not a candidate for that role, the bank said.

The juggling at the top of the bank’s structures follows the publication on 19 September of the findings of an internal investigation which showed around €200 billion ($234 billion) of suspicious cash flowed through the bank’s Estonian branch.

The money laundering scandal, dubbed the ‘biggest in Europe’ by an EU Commissioner, saw the bank issue a statement announcing Borgen’s resignation on 19 September, which also said that he ‘will continue in his position until a new CEO has been appointed.’

On Tuesday, however, it issued a statement from Danske Bank chairman Ole Anderson saying “it will be best for all parties that Thomas is relieved from his duties effective immediately.”

“Considering the current situation for Danske Bank, we believe that it would be best that the person who heads the Executive Board is also a part of the bank’s future,” Anderson said, “as you will know, Thomas F. Borgen has resigned and is thus not a part of Danske Bank’s future. Further, Thomas has now completed and transferred his tasks to the other members of the Executive Board.”

Meanwhile, it has been reported that investors were discontented with Borgen staying on until a new CEO is appointed and that they pressed for his immediate removal.

One boss of an organisation that holds shares in Danske Bank said: “The bank cannot move on with rebuilding the trust in the bank before he (Borgen) is gone,” according to Reuters.

A Danske Bank spokesman declined to comment on the shareholder’s reported comments. Efforts to obtain a comment from Borgen regarding the shareholder’s comments were also unsuccessful.

The spokesman referred to Anderson’s remarks, as well as a statement from Borgen regarding news of his immediate departure, in which he said: “I agree with the Board of Directors that it is best for all parties that the person who heads the Executive Board is someone who will remain with the bank and see that decisions made are carried out.

“And since I have, as already announced, resigned from my position, that person is not me. Further, I have completed my current tasks or transferred them, and therefore, it is only natural for me to leave now.”

– Irene Madongo

Read more:

Danske Bank investigation: Employees implicated in $234 billion money laundering scandal

Credit Suisse trouble over money laundering, beneficial ownership regarding FIFA

British MPs call for investigation into ‘untouchable’ senior bankers

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