HELSINKI (Reuters) - Nordea on Thursday welcomed a ruling that it and three other banks did not act negligently in issuing unapproved credit ratings and the resulting decision by the European Securities and Markets Authority (ESMA) to revoke fines worth 1.98 million euros ($2.24 million).
Nordea, the Nordic region’s largest bank, as well as SEB, Svenska Handelsbanken, and Swedbank had appealed a decision from last July by ESMA to fine each 495,000 euros for issuing credit ratings on research without authorization from the regulator.
The board of appeal on Wednesday upheld ESMA’s decision that the banks had issued illicit credit ratings but found the infringements were not committed negligently and therefore decided to revoke the fines.
Nordea said it would analyze the decision in detail before deciding whether or not to appeal to the European Court of Justice.
“Our publications of shadow ratings were made in reliance on what we thought was a clear exemption for credit research,” the bank wrote in an email to Reuters.
The unauthorized ratings were mainly produced between 2011 and 2016.
“It is clear that issuers of credit research can no longer include ‘shadow ratings’ in their credit research reports if those ratings use the AAA, BBB+ type formulations used by the credit rating agencies,” Julia Dixon, partner at law firm Linklaters said in a statement, referring to agencies like Moody’s, S&P and Fitch.
Reporting by Anne Kauranen; Editing by Elaine Hardcastle and Alexandra Hudson