STOCKHOLM: Svenska Handelsbanken AB, one of Europe's most profitable banks, fired its chief executive Frank Vang-Jensen yesterday after less than 18 months in the job, calling on his successor to push ahead with overseas expansion.
Anders Bouvin, head of its operations in Britain where the bank has been growing rapidly, will take over from Vang-Jensen who was himself rushed into the top job last year following a shake-up at the bank's main owner Industrivarden AB.
"The last job became a little too tough for him. He could not live up to the expectations," Handelsbanken chairman Par Boman said of Vang-Jensen, who was promoted from the role of head of the company's Swedish business.
"This recruitment was a mistake," Boman told a news conference.
Boman cited failings when it came to leading a large number of managers in a bank which has a very decentralised model.
Vang-Jensen's moves to slim down operations may also have ruffled feathers at the bank which has long prized a focus on its branch network and giving local managers great autonomy, such as decisions on whether to approve mortgages.
During his short time as CEO, Vang-Jensen closed around 60 bank branches mainly in Sweden's biggest cities but also in the countryside, prompting protests from some customers.
Boman said an important role for the CEO was to establish branches abroad.
"It's a clear mission for our CEO to grow abroad and now we have a CEO who has the possibilities to do that," he said.
The new CEO, Bouvin, told reporters the bank saw great growth prospects in specific European markets.
"We see great growth potential in both the UK and the Netherlands," he said. "Right now it is mainly in those two markets."
Handelsbanken refers to having six home markets on its website -- including Britain and the Netherlands, as well as Sweden, Denmark, Finland and Norway.
Handelsbanken shares have dropped 23% since Vang-Jensen became CEO although the bank is still the second-best performer among Sweden's major banks during that time.
Its average return on equity is in the teens, higher than the single figure average for European banks.
Vang-Jensen became CEO in March 2015 when then-CEO Boman was appointed chairman following a corporate spending scandal at a company also owned by Handelsbanken's main investor which led to several management and board changes.
Danske Bank analyst Matti Ahokas said the decision to replace Vang-Jensen signalled a return to basics for the bank.
"Vang-Jensen probably took a step towards a kind of more modern way as other banks have done, like reducing branches, focusing on technology," he said. "Now, it is probably a step back to the more traditional."