Danske Bank, Denmark’s largest bank by assets and customers, has replaced its chief executive officer Eivind Kolding, who is resigning today, effective immediately. 

WealthBriefing understands from sources familiar with the matter that Kolding was dismissed. 

(To view this publication's analysis of developments at Danske Bank over the past few months, click here.)

The board of directors of Danske Bank said in a statement that the head of corporate and institutional banking, Thomas F Borgen has been appointed as the new chief executive officer.

According to Danish media reports from DR (the Danish Broadcast Corporation) and the country’s leading financial publication, Borsen, Kolding was undoubtedly removed due to his lack of experience with and knowledge about banking. 

Borsen’s editor in chief, Niels Lunde, said that the move was partly based on “the need for a leader who has a stronger background when it comes to running a bank, as well as the need for a more consequent head of Danske. It’s a classic move by the board chairman, Ole Andersen, to make a swift and harsh decision when it comes to the leadership of the bank and such traits are essentially what he is looking for in the new chief executive officer.”  

The change follows a turbulent year for Danske Bank, where a new client strategy focusing on private rather than retail banking has lost the bank thousands of customers and compromised its trust ratings amongst the Danish public. The strategy was implemented in order to improve the bank’s equity - and recent numbers show that despite the poor reception of higher retail fees and closing of teller services, the bank’s results have improved significantly.

As such, the bank’s board of directors acknowledged Kolding’s contribution to Danske Bank as a driving force behind the bank's new strategy, as well as having completed a comprehensive reorganisation of the bank. 

“We are now in a phase, where the key focus is to transform the bank into being even more customer-oriented. The board of directors has assessed that - notwithstanding Eivind Kolding's professional and personal qualities - it is, in this phase, necessary to have a chief executive officer with stronger qualifications within banking. The board of directors has consequently decided to appoint Thomas F Borgen as new chief executive officer,” the chairman of the board of directors, Ole Andersen, said.   

Andersen added that the management change is not based on the economic development of the bank, which as mentioned, has proved positive in the first half of 2013. As such, the bank's outlook for the current financial year is unchanged.

Thomas F Borgen has been employed with the Danske Bank Group since 1997 and will remain head of corporate and institutional banking for the time being. Prior to this, Borgen was head of international banking activities and Danske Markets and in 2009 he also became a member of the bank’s executive board.