Nordea will exit its subcustody business in the Nordic countries and has entered into a strategic referral agreement with Citi for these services.
Nordea will now recommend that its subcustody clients use Citi as their new provider, a news release said. The firm will work with clients choosing to use a provider other than Citi through "an orderly transition of services," the release added.
While Nordea is exiting the subcustody business for the Nordic countries — covering Denmark, Sweden, Finland and Norway, a spokesman said — with services including settlement, safekeeping and asset servicing of Nordic-based securities, it will continue to focus on Nordic corporate, institutional and retail custody business.
"After careful consideration, we have concluded that the increasingly complex regulatory frameworks do not support us in delivering the level of value we intend for our clients," Martin Persson, head of large corporates and institutions at Nordea, said in the release. "The arrangement with Citi supports our strategic objective with increased Nordic focus. Our clients that transition to Citi can be confident that their short- and long-term needs are catered for in the best possible way."
Nordea plans on no layoffs as a result of the decision.