OSLO, May 21 (Reuters) - Norway’s financial watchdog has criticised Nordea Funds Ltd, a unit of top Nordic bank Nordea , for marketing one of its funds as active when it had in fact performed close to its benchmark, the regulator said on Thursday.
The rebuke followed a similar criticism of Norway’s DNB in March.
Regulators across Europe are closely watching so-called “closet indexing”, where a fund charges an active management fee but tracks the holdings and performance of the index against which its returns are benchmarked.
Norway’s Financial Supervisory Authority said it had analysed how a sample of funds had been managed from June 2009 to June 2014, and that the two DNB and Nordea funds were being criticised.
Nordea said in a statement the fund’s decision to focus on large companies had resulted in a high degree of correlation with Norway’s benchmark share index. It added that it had decided in the autumn of 2014 to cut its management fee for the fund by 25 percent. (Reporting by Terje Solsvik; Editing by Mark Heinrich)
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