Danske Bank recommends veteran German banker Blessing as new chairman

The Danske Bank logo is seen in Copenhagen, Denmark in this undated Scanpix Denmark photo. Scanpix Denmark/Jens Noergaard Larsen/via REUTERS

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COPENHAGEN, Feb 8 (Reuters) – Danske Bank (DANSKE.CO) said on Tuesday it would recommend veteran German banker Martin Blessing as its new chairman, tasked with boosting profitability and guiding the Danish lender through one of the most major money laundering scandals in the world.

Denmark’s biggest lender says current chairman Karsten Dybvad, a former head of the Confederation of Danish Industry and a senior civil servant before taking office three years ago, will not stand for re-election at a general meeting the 17th of March.

The bank will recommend Blessing, a former chief executive of Commerzbank (CBKG.DE) and former co-chairman of UBS’s global wealth management unit (UBSG.S), to replace him.

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Danske Bank is still trying to regain its footing after its involvement in a money laundering scandal at its former Estonian branch came to light in 2018.

The bank is still under investigation by authorities in Denmark, Estonia, France and the United States, and could face significant fines.

Its largest shareholder, the Maersk family holding company that controls shipping giant Maersk (MAERSKb.CO), said in a statement that it was “strongly supportive of Martin Blessing as his successor and presidential candidate, given his extensive executive leadership experience in the banking industry and his strong Personal Values.”

Dybvad has overseen two major management changes since his election in 2018. In April, Carsten Egeriis took over as CEO from Chris Vogelzang, who resigned after Dutch authorities named him a suspect in an investigation into human rights violations. money laundering regulations at lender ABN Amro (ABNd.AS). Read more

Danske is also struggling to cut costs, particularly in the area of ​​compliance, and drive revenue growth. It also faces legal action from investors, after the money laundering scandal wiped out an estimated $15 billion in market value.

Its shares were up 3.3% and 2.9% at 0918 GMT, but still around 50% below levels seen four years ago.

“Dybvad was president during a difficult time, but he didn’t make a difference,” said Nordnet analyst Per Hansen. “Danske Bank still has a lot of work ahead of it.”

Blessing, who joined Danske’s board in 2020, was also part of a group of investors who last year launched European Fintech IPO Company BV, a so-called blank check company that raises funds in the sole purpose of using the money for acquisitions. Read more

“If elected, I will ensure, together with the board and in close cooperation with the bank’s management team, that Danske Bank continues its positive development,” Blessing said in a statement.

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Reporting by Jacob Gronholt-Pedersen and Stine Jacobsen; Editing by Andrew Heavens, Kirsten Donovan and Susan Fenton

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