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The head of Austria’s Vorarlberger Landes- und Hypothekenbank AG resigned, becoming one of the first European senior bank executives to step down over reports from the leaked Panama Papers, citing “biased” media reporting about offshore accounts linked to a Russian oligarch at the province-owned lender.
Michael Grahammer, chief executive officer since 2012 and a board member of Hypo Vorarlberg since 2004, said in an e-mailed statement that he was stepping down, though neither the bank nor its staff had broken any laws.
“I’m still 100 percent convinced that the bank has at no time violated laws or sanctions,” Grahammer said. “At the end of the day, the media bias against Hypo Vorarlberg and myself that showed in the last few days was the main reason for me to take this step.”
Austrian public broadcaster ORF and weekly newspaper Falter reported that leaked records from Panama law firm Mossack Fonseca showed there were at least 20 accounts at Hypo Vorarlberg held by offshore companies, including one linked to Gennady Timchenko, a Russian billionaire who is among people sanctioned by the U.S. since 2014.
Hypo Vorarlberg said earlier this week that it only conducts legal business with offshore companies and is observing rules to prevent money laundering and sanctions. It also said that it started to wind down its business with offshore companies and would continue to do so over time. The bank is 76 percent owned by Austria’s westernmost Vorarlberg province, with the rest held by German state bank Landesbank Baden-Wuerttemberg.
Prosecutors in Feldkirch, Austria, had investigated suspicious transactions in 2012 but found no evidence of money laundering and terminated the probe in 2013 without bringing charges, the Austrian Press Agency reported this week.
Other senior bank executives in Europe have been summoned by regulators. French Finance Minister Michel Sapin called in Societe Generale SA’s top management for an unscheduled meeting Tuesday following the report, while Sweden’s FSA probed Nordea CEO Casper von Koskull earlier this week. Von Koskull denied wrongdoing. Before it's here, it's on the Bloomberg Terminal.