Danish watchdog names six banks as "systemically important"

COPENHAGEN, June 24 Tue Jun 24, 2014 8:34am EDT

Related Topics

COPENHAGEN, June 24 (Reuters) - Denmark's financial watchdog has named six banks and mortgage lenders as large enough to be considered as systemically important financial institutions.

The six are the market leader Danske Bank, biggest mortgage lender Nykredit Realkredit, Nordea Bank Danmark, Jyske Bank, Sydbank and mortgage lender DLR Kredit.

The Danish Financial Supervisory Authority (FSA) will monitor them more closely than other banks and they will have to meet higher capital buffer requirements.

The specific capital level for each institution will be published in the autumn, FSA said. These are expected to be phased in gradually from 2015 to 2019.

A systemically important institution is a term financial regulators use to categorise a bank that is large enough to pose a threat to the stability of a country's financial system if it runs into difficulties.

The Danish economy has been sluggish since a property bubble burst in 2009 and more than 60 banks, mainly small ones, have gone out of business since 2008. Some have been bought by other banks while others went bankrupt.

But the country's biggest banks are strongly capitalised and the FSA expects they will all be able to meet the capital requirements, an FSA spokesperson told Reuters. (Reporting by Ole Mikkelsen. Editing by Jane Merriman)


After wave of QE, onus shifts to leaders to boost economy

DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.