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Danish watchdog orders Handelsbanken to boost anti-money laundering efforts

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By Reuters
Danish watchdog orders Handelsbanken to boost anti-money laundering efforts
FILE PHOTO: A branch of Handelsbanken is seen in Wilmslow, northern England January 12, 2015. REUTERS/Phil Noble   -   Copyright  Phil Noble(Reuters)

COPENHAGEN (Reuters) – Denmark’s financial regulator has ordered the Danish unit of Swedish Handelsbanken <SHBa.ST> to strengthen its anti-money laundering efforts and revise its risk evaluation, the watchdog said on Thursday.

“The branch’s inherent risk of being misused for money laundering or terrorist financing is normal to high compared to the average of financial companies in Denmark,” the regulator said in a statement.

The Danish unit of Handelsbanken, the country’s fifth largest lender, was ordered to “revise its risk assessment,” since its current one failed to adequately consider its customer types and risks associated with its products, the regulator said.

“This in particular concerns the risk of the branch being misused for terrorist financing,” the regulator added.

Handelsbanken was further ordered to ensure ample control of know-your-customer processes and prevention of money laundering and terrorist financing.

Handelsbanken’s strategy of expanding west rather than east, primarily in Britain, mean it has not become embroiled in Baltic money laundering scandals that have engulfed Nordic rivals Danske Bank <DANSKE.CO> and Swedbank <SWEDa.ST>.

The bank said last month it seeks to cut costs after restructuring charges dragged down third-quarter earnings.

“We take the findings seriously,” a Handelsbanken spokesman told Reuters. “We will implement what the FSA says. The investigation was done in March, and we’re …doing so”.

(Reporting by Nikolaj Skydsgaard in Copenhagen, Colm Fulton in Stockholm; editing by Jacob Gronholt-Pedersen and Jason Neely)