Icelandic banks in Finland report no exodus of depositors

Icelandic banks operating in Finland say that they have not experienced any great flight of depositors - at least not yet. The Finnish customers of many Icelandic banks became worried on behalf of their deposits, when the Icelandic government nationalised Glitnir Bank on Monday.
     “We already reported that on Monday, a few million euros were withdrawn, but on Tuesday and Wednesday, we basically broke even. That is, there have been new depositors”, says Anssi Partanen, head of communications for Finnish Glitnir.
     Glitnir Bank operates in Finland as an independent subsidiary of the Icelandic parent company. It is registered in Finland, and its customers’ deposits are protected up to EUR 25,000.
     
Glitnir has 17,000 depositors in Finland, and a total of EUR 300 million in deposits.
     “Customers have naturally called and asked questions, but when we have explained the situation, they have taken the information quite well”, Partanen says.
     
The Icelandic bank to suffer the greatest losses has been eQ Bank, which has seen about EUR 20 million in deposits disappear in the past couple of weeks.
     Like Glitnir, eQ Bank is an independent subsidiary in Finland. Its Icelandic parent company is Straumur. It has about EUR 400 million in Finnish deposits.
      Antti Mäkinen, CEO of eQ Bank, says that another reason for their recent loss of deposits has been the higher interest rates that other banks have been offering.
     
“Small reactions” by customers were reported by Lauri Rosendahl, national director of Kaupthing Bank. In Finland, Kaupthing operates as a branch office of its parent company, and the deposits of the Finns are protected by the Icelandic deposit protection fund.
     Lauri Rosendahl says that withdrawals have been isolated, involving small sums of money, in relation to the wider deposits.
      “In the name of openness, I cannot deny that there have been some cases like that”, Rosendahl says.
     
The upheaval on world financial markets has prompted a flow of capital in the other direction in some banks. For instance, the Nooa Savings Bank and Ålandsbanken report that their deposits have grown slightly in recent weeks.
     “It appears that customers of other banks are diversifying in our direction”, says Nooa Bank CEO Oiva Iisakka.
     Iisakka says that Nooa has had two clear surges in depositors. One of them was linked with the problems of Sampo Bank in the spring, and the other one is coming now, with people worried about the protection of their deposits.


Previously in HS International Edition:
  Major Finnish investors seek to calm worries about financial crisis (30.9.2008)
  Danish owner says he has full confidence in Sampo Bank (8.8.2008)

Links:
  Glitnir
  eQ Bank
  Kaupthing Bank in Finland