Swedbank chairman quits over multibillion dollar money laundering scandal

Lars Idermark (right) with Swedbank's acting Chief ex Anders Karlsson at a press conference as part of Swedbank's Annual General Meeting in Stokholm, on March 28, 2019.
Lars Idermark (right) with Swedbank's acting Chief ex Anders Karlsson at a press conference as part of Swedbank's Annual General Meeting in Stokholm, on March 28, 2019.PHOTO: AFP

STOCKHOLM (BLOOMBERG) - A week after Swedbank AB fired its chief executive officer, the lender is parting ways with its chairman as a multibillion dollar money laundering scandal forces top-level changes.

Lars Idermark has decided to leave Sweden's oldest bank and biggest mortgage lender with immediate effect, Swedbank said in a statement on Friday (April 5). That follows a March 28 announcement that CEO Birgitte Bonnesen had been fired in the wake of the dirty money allegations.

Swedbank is being investigated by the financial supervisory authorities of Sweden and Estonia, as well as authorities in the US. In addition, Sweden's Economic Crime Authority has initiated a criminal probe to look into allegations of gross fraud, amid concerns Swedbank may have misled the public about the severity of the laundering case.

Idermark said his decision to leave came amid the "recent strong debate about Swedbank and questions about the bank's control of suspicious money laundering in the Baltics." He said that intense scrutiny of Swedbank was interfering with his other job as CEO of a forest-owner association called Sodra. "Therefore, I have decided that the best alternative is to leave the position as chair of Swedbank with immediate effect."

Idermark will be replaced by deputy chair Ulrika Francke, Swedbank said. But questions remain. Francke, like Idermark, sat on the board for many of the years during which the money laundering is alleged to have taken place. Some of the bank's most influential shareholders -- pension providers Alecta and AMF - have said they may demand an extraordinary shareholders' meeting later this spring to elect a new board.

Bonnesen has been replaced on an interim basis by the bank's former chief financial officer, Anders Karlsson.

The bank is allegedly tied to the US$230 billion (S$311.4 billion) Danske Bank Estonian laundering scandal. Swedish broadcaster SVT has reported that the suspicious amounts that flowed through Swedbank's non-resident accounts in Estonia may have exceeded US$100 billion between 2010 and 2016 alone.

Swedbank is the year's worst performing European financial stock so far, having lost almost a third of its value.

Idermark is the CEO of Sodra, Sweden's largest forest-owner association. He was chairman of Swedbank in 2010-2013 and deputy chairman in 2013-2016 before he became chairman again.