Swedish investment bank Carnegie buys troubled HQ

STOCKHOLM — Swedish investment bank HQ Bank said on Friday its competitor Carnegie would buy it after the authorities revoked its licences and forced it into liquidation."The board of HQ AB has decided to sell all common shares in its subsidiary HQ Bank ... (and) HQ Fonder ... to the Carnegie group," the company said in a statement.The news did little to calm the markets.When the Stockholm stock exchange resumed trading of HQ's stock after a four-day break Friday afternoon, the share price plummeted more than 60 percent in the first few minutes back on the market.The Swedish Financial Supervisory Authority (FI), which revoked HQ's licences last Saturday and had opposed an initial Carnegie bid a day later, said it now approved the 268-million-kronor (29-million-euro, 37-million-dollar) deal.FI "has approved Carnegie Investment Bank's purchase of HQ Bank and HQ Funds," the agency said in a statement, insisting the sale would help secure funds belonging to the beleaguered bank's approximately 20,000 depositors.The agency, which earlier this week reported HQ's auditor to the Swedish accountancy regulator, stressed however that HQ for the time being officially remained in liquidation.Carnegie meanwhile said HQ Bank's operations would be integrated into its own and that HQ Fonder (Funds) would become a subsidiary, adding that all of HQ's some 300 employees would move over to Carnegie."The merged company becomes the Nordic region's clearly leading independent investment bank," Carnegie said in a statement, adding that it would guarantee HQ Bank's liquidity and client deposits.HQ Bank, which manages around 60 billion kronor (6.3 billion euros, 8.1 billion dollars), hailed the deal."The transaction means that Carnegie therefore guarantees all HQ Bank's clients obligations ... (It) assures the continued operation of the business in HQ Bank," it said.As part of the deal, Carnegie will buy all the issued shares in HQ Bank for 268 million kronor, which correspond to outstanding convertible bonds held by the bank's emp

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