Lithuania criticizes Norwegian bank
August 4, 2011
The Lithuanian state finance regulator has attacked Norwegian bank DnB NOR for “unprofessional behaviour” after it allegedly sold structured savings products to amateur investors who went on to lose NOK 200 million (over USD 37 million).
640 Lithuanian investors were sold the structured savings products worth around NOK 1.55 billion (nearly USD 288 million) in the months before the financial crisis hit through DnB NORD, originally a joint operation between DnB NOR and a German Bank that trades in Estonia, Latvia, Lithuania and Poland. The Lithuanian authorities have criticized the bank for selling such products via inexperienced investors that were not sufficiently informed of the risk.
Norwegian Broadcasting (NRK) reports that the Lithuanian regulator has written a report that states, “we will not tolerate such unprofessional behaviour.” It goes on to say that “one scrupulous actor” can affect confidence in the whole financial markets system. The Lithuanian authorities now expect DnB NORD to compensate those who have lost out from the deals.
DnB NOR took full control of the bank in January. The company’s information director, Thomas Midteide, told news agency NTB that it did not agree with the regulator’s conclusions but was pleased to see that no measures were taken against the bank. “This is an old issue, and we did not own the bank at the time these sales happened,” Midteide commented, adding that “the products have not been sold in the last few years.”
Views and News staff