The ECB imposed million fines on Nordea: “The bank was guilty of violations”

The ECB has ordered Nordea Financing for Finland 2.26 million euro administrative penalty payment for violation of the large liabilities rule.

Nordea Rahoitus Suomi is a wholly owned subsidiary of Nordea.

According to the ECB, between 2021 and 2024, Nordea recorded 13 consecutive quarters of wrongful claims from debtors and not guarantors. The procedure is prohibited after the EU legislative change made in 2021.

As a result of incorrect reporting, the bank exceeded the 25 percent limit set by the EU, which applies to the maximum amount of a single large liability in relation to the bank’s own assets.

“The bank was guilty of violations as a result of serious negligence,” the ECB stated in its statement.

“Flaws in the bank’s internal control also contributed to the origin and duration of the violation,” the ECB stated.

In banking supervision, large responsibilities are one of the most important measures of risk management. They aim to prevent a situation where the bank is overly exposed to one customer or customer group. The key limits are 10 percent, the liability exceeding which is classified as a large liability. In addition, 25 percent is the absolute maximum limit for one counterparty.

If the bank exceeds the liability limits, it can endanger its own solvency and thus the stability of the entire financial system. For this reason, the ECB monitors the limits and imposes sanctions for violating them.

Nordea has the right to appeal the ECB’s decision to the Court of Justice of the European Union.

In Nordea’s message to Kauppalehti, the bank states that it discovered in October 2024 that it had violated the regulatory limits regarding large customer risks, that it immediately notified the ECB and corrected the situation.

“The breach has no effect on Nordea’s capital situation or the limits related to the group’s large customer risks. We have strengthened our internal control practices to ensure that something similar does not happen again,” Nordea communicates.

The story was updated at 10:26 a.m. Added statement from Nordea.