As in any other financial enterprise, some staff members will inevitably obtain inside information about listed corporate customers or about the company itself. The Danske Bank Group has organised its operations to ensure that as few as possible have access to inside information.
In addition, the Group has a number of business procedures that ensure that inside information is not passed on or used to trade securities.
In order to avoid problems with professional disqualification and conflicts of interest and to ensure that all transactions are made on a sound business foundation, Danske Bank has implemented a number of safeguards, including internal rules on the Group's trading in its own shares.
Insider policy
The Danske Bank Group's staff may acquire inside information about factors that affect the pricing of Danske Bank shares and the shares of customers that are exchange-listed companies. The Group therefore has clear guidelines for the treatment of inside information and the execution of security trades.
Insider trading is prohibited in Denmark. It is also prohibited to pass on inside information if the recipient does not need the information in question or misuses it.
Inside information about the Danske Bank Group
Danske Bank has internal procedures to ensure that inside information about the Bank is publicly disclosed as soon as possible in accordance with the legal requirements.
The Bank has prepared internal rules for treating inside information (the "Chinese Walls" rules). These rules include procedures for registering inside information and identifying insiders and insider departments, procedures on the persons to whom inside information may be disclosed, and guidelines for the treatment and storage of inside information.
The purpose of the rules is to prevent inside information from becoming accessible to others besides those who need it and to prevent the misuse of inside information.
The Bank has also prepared internal rules to ensure that the Danish Financial Supervisory Authority is notified if there is a justified suspicion of insider trading or price manipulation.
Danske Bank has prepared lists of employees who have access to inside information about the Bank as an issuer of securities or about any other issuers on whose behalf the Bank is acting. These lists are updated on an ongoing basis. The Bank notifies, without undue delay, the persons in question of their status as insiders and of the consequences of being in possession of inside information.
The Bank has prepared internal rules on access to trading in securities issued by Danske Bank or associated derivative instruments by members of the Board of Directors and the Executive Board and by other employees, either on their own accounts or on the accounts of third parties.
The Bank has also prepared internal rules on directors', executive officers' and their close relations' obligation to report information to the Bank about transactions on their own accounts in securities issued by the Bank as well as rules on the Bank's reporting of this information to the Copenhagen Stock Exchange.
Inside information about customers that are exchange-listed companies
Staff members who because of their positions acquire inside information about listed companies are subject to special rules. The Group has also established Chinese walls between relevant staff members and follows the Danish Securities Dealers Association's recommendations on the regulation of equity research and corporate finance activities and employee securities trading.
The Chinese walls stand between staff members who need inside information in their work in the Group and the Group's other staff members, especially staff who trade or provide advice about securities or who issue research reports and recommendations.
Danske Bank also pursues a policy that prevents equity analysts and related parties from trading equities that the analyst covers or equities in the sector the analyst covers.
Trading in own shares
As an issuer of publicly traded securities, the Danske Bank Group has prepared internal rules on the Group's trading in its own shares. The Group trades Danske Bank shares on its own account in the following contexts:
- Share repurchase programmes
- Hedging of options programmes
Danske Bank also takes customer-driven positions in Danske Bank shares, and in periods outside of share repurchase programmes, it takes positions in the share on its own account. Finally, the Group invests the savings of members of pooled investment schemes and insurance policyholders in Danske Bank shares. The latter investments are conducted by Danske Capital, which is an independent business unit.
All share repurchase programmes are planned by Group Finance, but the share purchases themselves are conducted by Danske Markets Group Treasury, which usually executes the transactions through Danske Equities.
Group Treasury determines the amount of the daily share buybacks on the basis of internal rules. The Group does not repurchase shares in the periods of three weeks immediately before each of its quarterly financial reports.
Danske Markets Group Treasury is also responsible for the Bank's management options. The options are hedged on the basis of a delta calculation when the price of Danske Bank shares changes by 3%. Hedging transactions are conducted on all trading days of the year.
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