Corporate governance

Finansiel Stabilitet structures the management of the Group and the performance of the Group’s activities in accordance with the special obligation imposed on Finansiel Stabilitet to support financial stability in Denmark.

Finansiel Stabilitet complies with the recommendations for exercising ownership and practising corporate governance in state-owned public companies, as described in the ownership policy of the Danish State published in 2015. In addition, Finansiel Stabilitet has chosen to comply with the recommendations of the Committee on Corporate Governance to the widest extent possible, even though Finansiel Stabilitet is not directly comprised by the recommendations. This annual report includes reporting on compliance with the Corporate Governance Recommendations, which were updated in December 2020 and are effective for financial years beginning on or after 1 January 2021.

At least once a year, the Board of Directors and the Management Board review the principles defined for the management of Finansiel Stabilitet and make ongoing adjustments as and when needed to ensure that the Company complies with good practice in the area.

The overall objectives are defined by the Ministry of Industry, Business and Financial Affairs. In light of the special tasks to be performed in accordance with the legislative framework, certain parts of the decisions on acceptance of risk are not left to the Board of Directors as would normally be the case. Against this background, Finansiel Stabilitet has assessed that it is not relevant to comply with the Committee’s corporate governance recommendations in relation to risk management. Within the given framework, the Board of Directors of Finansiel Stabilitet has sought to enhance the risk management efficiency of the assets taken over.

Moreover, the Committee’s recommendations on the handling of takeover bids have no relevance for Finansiel Stabilitet due to the Company’s status as an independent public company. Likewise, the Company has chosen not to comply with a few other recommendations as described below.

The Ministry of Industry, Business and Financial Affairs on behalf of the Danish State is the Company’s sole owner. Finansiel Stabilitet maintains an ongoing dialogue with its owner to ensure that the Minister for Industry, Business and Financial Affairs receives relevant information on matters related to Finansiel Stabilitet. The relationship between Finansiel Stabilitet and the Ministry of Industry, Business and Financial Affairs is furthermore governed by a Strategic Governance Document for Finansiel Stabilitet, which also contains guidelines for exchange of information.

Finansiel Stabilitet publishes interim financial statements and releases quarterly announcements. The Company does not publish full interim financial statements for the first and third quarters. Finansiel Stabilitet thereby deviates from the recommendations of the Committee on Corporate Governance.

It is assessed that the release of quarterly financial statements would not contribute material new information relative to the information already released through the quarterly announcements and other announcements.

Finansiel Stabilitet is subject to the rules applying to state-owned companies, which implies, among other things, that in key areas the Company is subject to the same requirements as listed companies. Announcements and other information from Finansiel Stabilitet and its subsidiaries are released through the Danish Business Authority and through the Company’s website, www.fs.dk. The website also provides information about the Company’s structure, activities, etc.

The general meeting is the Company’s supreme decision-making body. The Ministry of Industry, Business and Financial Affairs has same powers at general meetings as those awarded to shareholders pursuant to the Companies Act. Representatives of the Ministry of Industry, Business and Financial Affairs, the Board of Directors, the Management Board, the National Audit Office and the Company’s auditors attend the annual general meeting.

General meetings are open to the press. However, the Board of Directors of Finansiel Stabilitet may decide that a general meeting should be closed or partially closed to the press if motivated by considerations for the discharge of Finansiel Stabilitet’s objects, powers and responsibilities. Notices convening general meetings are published and distributed to the Minister for Industry, Business and Financial Affairs or his proxy not less than two weeks and not more than four weeks prior to the date of the general meeting.

Prior to election of members to the Board of Directors at the general meeting, information must be provided on the experience and professional background of the individual candidates. As the candidates are nominated by the Company’s sole owner, the Ministry of Industry, Business and Financial Affairs, it is assessed that there is no need to distribute information about the competences of the candidates together with the notice convening the general meeting. Finansiel Stabilitet thereby deviates from the recommendations of the Committee on Corporate Governance.

Finansiel Stabilitet has a two-tier management structure, consisting of the Board of Directors and the Management Board. The two bodies are mutually independent and have no overlapping members.

Finansiel Stabilitet’s subsidiaries are managed by independent management boards and boards of directors, which in part consist of Finansiel Stabilitet’s general management. This structure entails that Finansiel Stabilitet is represented on the boards of directors of all subsidiaries.

The Board of Directors is responsible for the overall management of Finansiel Stabilitet. The general guidelines for the work of the Board of Directors have been defined in the rules of procedure for the Board of Directors, which are revised on an ongoing basis and as required. The rules of procedure in force from time to time are available at Finansiel Stabilitet’s website, www.fs.dk. Due to the special objects and nature of Finansiel Stabilitet, the Board of Directors has flexible working methods and plans its work so as to accommodate the tasks at hand.

A total of 12 board meetings were held in 2022, including 5 extraordinary board meetings. A total of 11 board meetings were held in 2021.

The Board of Directors is continuously updated on the Company’s situation. These updates take place through meetings as well as through written and oral reporting. The Board of Directors receives semi-annual reporting, including information about economic developments and the most important activities and transactions. The Board of Directors furthermore maintains a continuous dialogue with the general Management on the cases against the former managements, etc. of the banks taken over.

Finansiel Stabilitet deviates from the recommendations of the Committee on Corporate Governance with respect to board committees, as the Board of Directors has not to date found it necessary to set up an audit committee or a risk committee and, due to the close affiliation with the Minister for Industry, Business and Financial Affairs, has not found it necessary to set up remuneration and nomination committees.

The Board of Directors regularly and at least once a year evaluates the tasks and composition of the Board of Directors and the collaboration between the Board of Directors and the Management Board.

At 31 December 2022, the Board of Directors of Finansiel Stabilitet consisted of seven members.

The Minister for Industry, Business and Financial Affairs appoints the members of the Board of Directors, including the Chairman and the Deputy Chairman. Neither the employees of Finansiel Stabilitet nor the employees of Finansiel Stabilitet’s subsidiaries are entitled to elect members to the Board of Directors of Finansiel Stabilitet.

The members of the Board of Directors are elected for a term of one year, but are eligible for re-election. At the annual general meeting held on 29 April 2022, Peter Engberg Jensen, Anne Louise Eberhard, Ulrik Rammeskow Bang-Pedersen Ole Selch Bak, Morten Sommerfeldt and Jesper Rangvid were re-elected to the Board of Directors.

Peter Engberg Jensen was re-elected as Chairman, and Anne Louise Eberhard was re-elected as Deputy Chairman. At the extraordinary general meeting held on 30 June 2022, Anne Louise Eberhard was elected as Chairman of the Board of Directors and Ole Selch Bak as Deputy Chairman. Both were appointed for a period of one year from the annual general meeting held on 29 April 2022. Pernille Vastrup was re-elected to the Board of Directors, and Ulrikke Ekelund was elected to the Board of Directors. Peter Engberg Jensen resigned from the Board of Directors.

The Chairman of the Board of Directors may not undertake any offices on behalf of Finansiel Stabilitet which do not form a natural part of the office as chairman. However, if specifically required, the Chairman may perform tasks which he or she is requested to perform by and on behalf of the Board of Directors.

Candidates for the Board of Directors must possess relevant skills, and the Board of Directors as a whole must possess knowledge and experience of the key issues and challenges faced by Finansiel Stabilitet. Based on the Company’s business model and related risks, the Board of Directors annually identifies the areas which it deems the Management Board and the Board of Directors of Finansiel Stabilitet should have knowledge of and experience with. The circumstances relating to the Company’s management are adjusted as required on the basis of these assessments.

Prior to election of members to the Board of Directors at the general meeting, information must be provided on the experience and professional background of the individual candidates. As the candidates are nominated by the Company’s sole owner, the Ministry of Industry, Business and Financial Affairs, it is assessed that there is no need to distribute information about the competences of the candidates together with the notice convening the general meeting. Finansiel Stabilitet thereby deviates from the recommendations of the Committee on Corporate Governance.

Information about the individual board members is provided in this Annual Report and on Finansiel Stabilitet’s website, www.fs.dk.

The Management Board is composed of Karsten Biltoft, CEO. Until 31 December 2022, the Management Board along with Marianne Simonsen, EVP Legal and Credit, and Jens Verner Andersen, EVP Finance and IT were in charge of the day-to-day management of Finansiel Stabilitet.

As part of an organisational change, the day-to-day management of Finansiel Stabilitet has been expanded to five members, as at 1 January 2023 consisting of Karsten Biltoft (CEO), Jens Verner Andersen (EVP Credit, Finance and IT), Attorney Carsten Oppermann (Deputy Director, Legal), Jeanette Bjørnlund Jensen (Head of Division, Credit, Research and Investment) and Karin Lykke Rasmussen (Head of the Management Secretariat, Communication and Projects).

The guidelines for the Management Board’s reporting and submission of decisions to the Board of Directors and for the distribution of powers and responsibilities between the Board of Directors and the Management Board are laid down in instructions to the Management Board.

Each member of the Board of Directors receives a fixed annual remuneration, and the total annual emoluments paid to the Board of Directors are approved at the general meeting in connection with the approval of the annual report.

In the financial year 2022, remuneration paid to the Board of Directors amounted to DKK 1,362 thousand. The remuneration of the Board of Directors is disclosed on www.fs.dk.

The remuneration of the Management Board is determined by the Board of Directors, and in 2022 the remuneration of the Management Board consisted of a basic salary.

Finansiel Stabilitet has no pension obligations towards the Management Board. Members of the Management Board are not covered by bonus schemes and do not receive a separate fee for directorships held in subsidiaries. The remuneration of the Management Board is disclosed on www.fs.dk.

The terms of employment of the Management Board, including remuneration and severance terms, are deemed to be consistent with ordinary standards for a position of this nature and do not entail any special obligations on the part of the Company.

Finansiel Stabilitet complies with the remuneration recommendations of the Danish State’s ownership policy, and the Company’s remuneration policy reflects these rules. This includes paying competitive – but not top-bracket – salaries compared with peer companies in the public and private sectors.

Finansiel Stabilitet abides by legally binding agreements with employees entered into in connection with the takeover of failing banks.

The Board of Directors and the Management Board check the financial reporting, including compliance with relevant legislation and other regulations related thereto. Finansiel Stabilitet has set up the necessary internal controls to ensure that the Company’s financial reports give a true and fair view.

The Management Board maintains effective procedures to identify, monitor and report on risks, effective internal control procedures as well as satisfactory IT control and security measures. In order to prevent misstatements and irregularities in financial reporting, Finansiel Stabilitet assesses and adjusts its internal control and risk management systems on an ongoing basis.

Finansiel Stabilitet has established a whistleblower scheme for the Group, which is accessible via Finansiel Stabilitet’s website, www.fs.dk. The objective of the whistleblower scheme is to ensure expedient and confidential reporting of offences – or suspicion of offences – to an independent and autonomous unit, which can evaluate what measures should be taken. Under the whistleblower scheme, employees and other Finansiel Stabilitet stakeholders can report, anonymously or not, on any serious misconduct.

The activities of Finansiel Stabilitet are audited by the Auditor General of Denmark and a state-authorised public accountant. The state-authorised public accountant is appointed for a term of one year at the general meeting and must be certified by the Danish FSA.

Before nominating a candidate for appointment at the general meeting, the Board of Directors makes an assessment of the state-authorised public accountant’s independence, qualifications, etc.

The framework for the auditors’ duties, including their remuneration, audit and non-audit assignments are written into a service contract. EY was appointed auditors of the Finansiel Stabilitet Group’s activities in 2022.