Reuters: Bankruptcy News: Denmark's Sydbank agrees to buy Tonder Bank

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Denmark's Sydbank agrees to buy Tonder Bank Nov 2nd 2012, 18:44 COPENHAGEN | Fri Nov 2, 2012 2:44pm EDT COPENHAGEN Nov 2 (Reuters) - Sydbank, Denmark's third-biggest bank, has agreed to acquire Tonder Bank, a small lender in the south of the country, the latest deal in a banking industry under pressure from tough new regulations. Sydbank said on Friday it would take over Tonder Bank's 18,000 customers and a balance sheet worth 2.3 billion Danish crowns ($396 million). All depositors will be covered by the transfer to Sydbank. Danish banks have been stung by bad loans in the aftermath of a burst property bubble, a struggling agriculture sector and following tighter writedown rules imposed by the country's regulator in April. Tonder Bank said in a statement the new writedown rules and a deadline to meet new solvency requirements by this Sunday had left it no alternative other than filing for bankruptcy on Monday. "It has not been possible to provide the necessary capital within the prescribed period and therefore the bank must give up its independence," the bank said in a statement. Its board members have tendered their resignation. Denmark has the most fragmented banking industry in the Nordic region with more than 100 banks and many in the industry are predicting a wave of consolidation. In September, two of the country's smaller listed banks, Salling Bank and Vinderup Bank, said they would merge. Spar Nord Bank announced a week later it would acquire rival Sparbank. Sydbank, which said the acquisition would help strengthen its position in southern Jutland, and Denmark's second-biggest lender Jyske Bank have both said they would be interested in buying rivals. Some speculate that Sweden's capital-rich banks could also muscle into a wave of mergers in the country. ($1 = 5.8072 Danish crowns) (Reporting by Mia Shanley; Editing by David Holmes) Link this Share this Digg this Email Reprints

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