- Jesper Berg takes over as Danish FSA chief later this year
- Predecessor gave FSA a tough-on-banks reputation during crisis
The new head of Denmark’s financial watchdog says challenges posed by the country’s economic recovery will shape his tenure, much as the financial crisis shaped that of his predecessor.
“In many ways, it is just a question of continuing” the work of Ulrik Noedgaard, said Jesper Berg, who takes over as director general of the Danish Financial Supervisory Authority on Oct. 1, by phone on Wednesday. “But clearly the times are changing. Hopefully the economy will be doing better, with the challenges that entails.”
The FSA is policing banks more closely to ensure they’re not easing credit standards amid record low interest rates. The Copenhagen agency said last month it’s investigating whether banks are lending borrowers more than they can afford as property price increases raise concerns a bubble may be forming.
Under Noedgaard, the FSA gained a reputation as a tough regular, conducting surprise inspections, increasing public disclosure and imposing new guidelines to stem risky lending. The measures came on top of increased reporting and capital demands from global regulators.
Noedgaard said in April that he was resigning after more than six years as director general to take the top job at Danish Bankers Association.
Berg said the measures taken by his predecessor have helped make the financial system more robust.
“We’ve come out of a crisis,” Berg, 56, said. “We know that crises will occur again but most likely, hopefully, there are some years before we see the next one. We are creating a basis that you can handle the next crisis.”
Berg declined to specify what the agency may do to further strengthen oversight of Denmark’s financial industry, which including insurers and pension funds is about six times the size of the economy. A economic recovery is likely to present challenges for the FSA itself, Berg said.
“Whenever times are better, the history of the supervisory institution is of losing staff members to the private sector,” Berg said. “I would presume that would happen again. One of the major challenges is to create an atmosphere where the staff feels that they continue to develop.”