In 2023, the work to develop resolution plans for Danish, Faroese and Greenland banks, mortgage credit institutions and the investment companies covered by the Act on Restructuring and Resolution of Certain Financial Enterprises continued.

This work forms part of a common European effort to ensure the credibility of the way member states manage failing banks and mortgage credit institutions etc., so that the institutions’ crisis management bears the full responsibility for the operation and capital position of the institutions. A central part of the resolution plans is setting out a preferred resolution strategy to facilitate the continuity of a failing institution’s critical functions, which is considered when the Danish FSA determines the requirement for eligible liabilities. In collaboration with the Danish FSA, Finansiel Stabilitet has prepared a description of how a resolution process is to be executed. This description is available at www.fs.dk. The resolution plans will be regularly reviewed and, if necessary, adjusted. This entails collaboration with the institutions and greater focus on establishing actual scripts to ensure that the resolution plan is operational.

Finansiel Stabilitet also participates in international resolution colleges for the purpose of preparing resolution plans for cross-border SIFIs, where these have significant branches or subsidiaries in Denmark. For cross-border SIFIs domiciled in Denmark, the group resolution authority is Danish, and Denmark is in charge of the resolution college.

In addition to these activities, Finansiel Stabilitet continually focuses on testing the contingency resolution measures of the institutions. In order to achieve the resolution objectives it is vital from a practical perspective that Finansiel Stabilitet quickly gets access to all relevant data. The testing evaluates whether the institutions have procedures and data access that will enable them to supply Finansiel Stabilitet with data in a time-critical resolution situation. Finansiel Stabilitet and the Danish FSA together perform the testing of contingency resolution measures.

In 2015, Finansiel Stabilitet assumed control of Andelskassen J.A.K. Slagelse, as the institution was failing and needed crisis management. As part of the takeover, all shareholders and a relevant part of the creditors were written down, as a valuation carried out by an independent valuation expert had shown that there were insufficient funds to cover these liabilities. On 31 May 2017, Andelskassen J.A.K. Slagelse under control deposited its licence to carry on banking and securities trading activities. The bank was at the same time converted into a financing company with the name of FS Finans V A/S, from which the resolution of remaining loans was to take place.

At 31 December 2023, FS Finans V A/S had loans and guarantees representing a total carrying amount of DKK 9 million and total assets of DKK 29 million.

At the end of 2023, the Resolution Fund had a total deficit of DKK 1 million in relation to the resolution of Andelskassen J.A.K. Slagelse.

In 2018, Finansiel Stabilitet assumed control of Københavns Andelskasse, as the institution was failing and needed crisis management. As part of the takeover, shareholders and a part of the creditors were written down, as a valuation carried out by an independent valuation expert had shown that there were insufficient funds to cover all creditors. On 28 June 2019, Københavns Andelskasse under control deposited its licence to carry on banking and securities trading activities. The bank was at the same date converted into a financing company with the name of FS Finans VI A/S, from which the winding up of remaining loans will take place.

In May 2019, Finansiel Stabilitet filed two liability lawsuits against the former management of Københavns Andelskasse before the District Court of Copenhagen.

One of these lawsuits concerns Københavns Andelskasse's acquisition of the company OTC-listen. In this case, the District Court of Copenhagen on 25 May 2022 delivered a decision, by which the claims against all management members were dismissed. Finansiel Stabilitet was ordered to pay legal costs in the amount of DKK 5.7 million. FS Finans VI A/S appealed the decision to the High Court of Eastern Denmark on 8 June 2022. The trial hearing in the case is scheduled for August 2024.

In the other lawsuit, which concerns management’s liability in connection with losses on 2 loan exposures, the District Court of Copenhagen on 16 August 2022 delivered a decision, by which two management members were ordered to pay damages of DKK 2.5 million in respect of one of the loan exposures. FS Finans VI A/S was ordered to pay legal costs of DKK 700,000 to the management members against whom the claim was dismissed. The two management members found liable were ordered to pay legal costs of approximately DKK 400,000 to FS Finans VI A/S. The two management members found liable appealed the decision to the High Court of Eastern Denmark. FS Finans VI A/S subsequently appealed the decision, claiming that the decision of the District Court be upheld, and appealed the dismissal of the claim related to the other loan exposure with respect to one of the management members. The trial hearing in the case is scheduled for February 2025.

At 31 December 2023, FS Finans VI A/S had net loans and guarantees representing a total carrying amount of DKK 8 million and total assets of DKK 37 million.

At the end of 2023, the Resolution Fund had a total deficit of DKK 0.4 million in relation to the resolution of Københavns Andelskasse.