Financial watchdogs in the Nordic region are beefing up their operations in response to the financial crisis.
Although not hit as hard as many countries by the maelstrom, regulators in Sweden, Denmark and Norway recognise the need for staff who understand the complex global structures the region’s banks and insurers are locked into. But does that mean they will be looking to hire experienced staff from financial institutions?
Jonatan Holst, a spokesperson for Sweden’s Finansinspektionen, says the regulator has seen its annual budget increased by a third to around SEK400m, as a response to the crisis which revealed the need for stronger and more intrusive supervision.
“The past couple of years have demonstrated exactly how costly imbalances in the financial sector can become if left unchecked and we along with most countries are currently working on increasing and improving supervision in order to prevent such an event from happening again,” he says.
Holst says around 30 staff comprising analysts, legal counsels and supervisors will be added to the supervisory team by 2014. “We have already grown by almost 40 people during 2011 and forecast that we will have at least 350 employees by 2014.”
Holst says the regulator will look to recruit from financial institutions. “Much of our current workforce has experience from the financial industry,’ he says. ‘It is essential for us to have know-how and hands on experience from the financial sector in order to maintain a high level of supervision.”
Denmark’s regulator Finanstilsynet has increased its staff by ten per cent in the last three years to a current workforce of 240 staff.
Søren Møller Christensen, a spokesperson for regulator, says: “There are two main drivers behind this increase, one is a general strengthening of the bank supervision activities following the financial crisis, and the other is supervisory activities related to the introduction of the Solvency II regulation in the pension and insurance sectors.”
Christensen says that although it is not certain the regulator will continue to beef up staff numbers, any additional staff are likely to be recruited from financial institutions. “The Danish FSA has, in several cases, hired people with education and experience from the banking sector to work in our bank supervision units, i.e. people with skills in assessing credit risks in bank’s loan portfolios,” he says. “We would like to see that happen again in the future.”
Last July, Emil Steffensen, director-general of Norway’s regulator which is also called Finanstilsynet, said that following the financial crisis ‘a need for staff with a background in macroeconomics and finance to run the analytical work, was recognised.
does not run its own macroeconomic models, so it is necessary to do the analytical work in-house in order to have a proper understanding of issues related to the cycle.”
The speech followed a report by the financial watchdog’s board in November 2010 that said for the period to 2014 it is “pursuing a targeted recruitment policy that facilitates the appointment of individuals with industry experience.”