Danske Bank sacks former interim CEO

Danske Bank has fired its former interim chief executive officer after customers were overcharged for an investment product.

Jesper Nielsen has been dismissed from his role as head of banking at Danske, which said on Monday that 87,000 customers who invested in its Flexinvest Fri product had been made to pay fees that were too high.

Danske said this was the result of a number of management decisions to change Flexinvest Fri fees in connection with the implementation of new regulation - MiFID II - back in 2017. At the time, interest rates were low, and the expected returns were similarly low, it said.

It said management decisions caused the fees to be set at too high a level in relation to the expected returns, meaning they were too high for all customers, making the product unsuitable for some customers. As a result, all customers who invested in the product during the period in question will receive compensation from the bank before the year is out.

The company said Jesper was one of the responsible executive board members "who did not to a sufficient degree ensure that the Flexinvest Fri product was suitable for the bank’s customers".

"Therefore, we find that Jesper cannot continue in his position,” said Karsten Dybvad, chairman of Danske's board of directors.

Chief executive officer Chris Vogelzang said: "As I said on my first day in office, customers must be at the heart of everything we do. Every single day, we must strive to ensure that we offer our customers proper advice and products that suit their needs. This is also what customers rightfully expect from us.

"As a result of misguided management decisions, we failed to do so in this specific matter, and for this we offer our apologies. Of course, we will compensate all affected customers. And we will take all the steps necessary to prevent something similar from happening again in future."

At 1345 BST, the shares were down 3.5% at DKK100.30.