The Competition Authority must further consider Nordea’s acquisition of Danske Bank

Competition in the Norwegian market for banking services may be impaired if Nordea is permitted to acquire Danske Bank. The Norwegian Competition Authority therefore needs to examine the acquisition in more detail.

Nordea’s acquisition of parts of Danske Bank, including Danske Banks private banking portfolio, is subject to approval by the Norwegian Competition Authority. To consider the effects this acquisition may have on competition, the Competition Authority has collected and analyzed detailed information from the parties, as well as from customers and competitors in the bank market. The Authority’s first deadline for presenting a preliminary assessment of the acquisition is today, 7 November.

The Authority’s preliminary assessment is that competition in the market for bank services may be impaired if Nordea is permitted to acquire Danske Bank.

– The market for banking services is a large and significant market for Norwegian consumers, especially when interest rates on mortgages are rising and putting an increasing strain on people’s personal finances. Well-functioning competition is crucial to ensure that Norwegian bank customers pay the lowest interest rates possible on their mortgages. Further analyses of how Nordea’s acquisition of Danske Bank will affect competition in this market are needed, says Director General Tina Søreide.

One of the Competition Authority’s concerns is that the acquisition will create a significant impediment to effective competition in the market for mortgages. This applies both in general, and in the part of the market for mortgages that is directed at organizations such as unions. There may also be reason to fear that the acquisition will make it easier for the banks to coordinate their behavior in the mortgage market. The Competition Authority will also further analyze if the acquisition could have negative effects on the competition in the market for Private Banking services.

Due to the deadlines outlined in the Competition Act, the Competition Authority must publish a new assessment by 12 January, 2024. At that point, the Authority must either permit the acquisition or notify the parties that there could be grounds for prohibiting it.

– Our preliminary assessment is that there may be reason to fear that the acquisition will impact Norwegian bank customers negatively. Going forward, the Competition Authority will more thoroughly consider whether there are reasons to prohibit the acquisition, says Director Gjermund Nese.