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Thursday, May 23, 2024

DNB boss got a standing ovation

Rune Bjerke, embattled chief executive of major Norwegian bank DNB, has received at least some encouragment as he continues to deal with the uproar over disclosures about the bank’s tax haven use. His own employees and middle-managers at the bank gave him a standing ovation at a meeting last week, in a spontaneous show of support.

Rune Bjerke, appointed as chief executive of DNB during the former Labour Party-led government, has a lot of explaining to do over DNB's "private banking" operations. PHOTO: DNB
DNB’s chief executive Rune Bjerke could at least claim support from his own employees, while caught in the storm over tax haven disclosures in the “Panama Papers.” PHOTO: DNB

Newspaper Dagens Næringsliv (DN) reported that around 100 bank leaders stood up and started clapping after he’d addressed a meeting of middle-management personnel. Among them was Viktor Sæther, who also represents many bank employees who are members of the trade union federation LO.

“Yes, I clapped, too,” Sæther told DN. “I’m satisfied with Rune Bjerke because he has done a lot for the bank over the past 10 years. I became the employees’ representative at the same time he began (in 2007).”

It should be mentioned that LO is closely affiliated with Norway’s Labour Party, and Bjerke is a former Labour Party politician and good friends with former Labour Prime Minister Jens Stoltenberg. Sæther said he had “a lot of sympathy for Rune now.”

He wouldn’t comment on the concrete disclosures in the case that have prompted government Trade Minister Monica Mæland to demand more answers and raised speculation over whether the government will retain confidence in Bjerke. He has claimed he knew nothing about DNB’s operations in Luxembourg that bought so-called “postbox” companies from a Panamanian law firm that had registered them in tax havens. DNB Luxembourg’s wealthy customers in its private banking division could then use the companies to hide assets and income from tax collectors.

The state is DNB’s largest shareholder and any lack of confidence in Bjerke’s management would put pressure on him to resign. “I feel sorry for Rune now,” Sæther said. “You can’t have an overview in detail over absolutely everything.”

‘We believe him’
Other bank employees were also defending Bjerke despite their disappointment that the bank could have helped customers evade taxes. “We think the case is terrible,” Vigdis Mathiesen, another representative of around 5,000 employees who are members of labour federation Finansforbundet, told DN. “What’s come forth should never have happened. Even though we (the bank) haven’t done anything illegal, it’s a violation of internal routines and management has to clean up after this.”

She nonetheless was giving Bjerke her full support, feeling that he’s landed in “a terribly difficult situation.” She said she and her fellow union members “have confidence in what Rune Bjerke is saying. We believe him when he says he didn’t know anything. We think he has done a good job.”

Mathiesen was also at the meeting where employees gave Bjerke the standing ovation. “I viewed it as a strong show of support for Rune Bjerke, and I think most people in the bank support him,” she told DN.

The ovation surprised a professor at the Norwegian Business School BI who specializes in crisis communications. “He must have built up a phenomenal milieu internally,” Professor Petty Simcic Brønn told DN. “It sounds like he must be at the top of the scale where everyone is loyal and totally supports the CEO.”

Brønn doesn’t think DNB’s top management has done a good job. She also noted that the entire bank organization can be in defense mode at present, fending off a “common enemy” in the form of state regulators and angry top politicians. Berglund



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