Swedbank Books $3.7 Million Provision for Potential Deal With US Treasury

By Dominic Chopping

STOCKHOLM--Swedbank AB said Friday that it has booked a provision of 40 million Swedish kronor ($3.7 million) after assessing the financial impact from a probe by the U.S. Treasury's Office for Foreign Assets Control into the bank's past measures to prevent money laundering.

The bank is under investigation for governance deficiencies related to anti-money laundering measures in its Baltic subsidiaries after a Swedish TV show reported in 2019 that billions of dollars of potentially illicit funds might have passed through the bank's Estonian branch.

The Swedish financial regulator FSA handed Swedbank a SEK4 billion fine in 2020 after finding the lender's Baltic operations had serious deficiencies in its anti-money laundering measures as well as shortcomings in its cooperation with the investigation.

"Swedbank can now assess the financial impact from the investigation by the U.S. Treasury's Office for Foreign Assets Control (OFAC) regarding the bank's historical shortcomings," it said.

The bank said dialogue with OFAC is good but it can't say when the investigation will be concluded.

Probes by the Department of Justice, Securities and Exchange Commission and Department of Financial Services in New York are ongoing and the bank said it can't determine any financial consequences, nor when the investigations will be completed.

Write to Dominic Chopping at [e-mail]

(END) Dow Jones Newswires

March 10, 2023 02:19 ET (07:19 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.