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Document Type

Case Study

Case Series

Ad hoc Emergency Liquidity Programs

Abstract

In October 2008, Carnegie Investment Bank AB (Carnegie) had trouble obtaining financing amid concerns about its financial health. However, Sweden’s central bank, the Sveriges Riksbank (Riksbank), and the Swedish Financial Supervisory Authority (FSA) still viewed Carnegie as solvent. Between October 27 and 28, the Riksbank lent Carnegie 2.4 billion Swedish kronor (SEK). As collateral for the loan, Carnegie and its holding company, D. Carnegie & Co. AB (D. Carnegie), provided all shares and subsidiaries in Carnegie as well as all shares in a sister subsidiary under D. Carnegie, Max Matthiessen Holding AB (Max Matthiessen). On November 10, 2008, the FSA revoked Carnegie’s bank and securities licenses, and the Swedish National Debt Office (NDO) took over the loan from the Riksbank, alerted the holding company that it had taken over the collateral, and became the sole shareholder of Carnegie and Max Matthiessen. Later that day, the FSA reversed its decision and allowed Carnegie to retain its licenses and remain operational. In separate transactions, the NDO sold Carnegie and Max Matthiessen to joint ventures of private equity groups Altor Equity Partners and Bure Equity AB in February 2009 for a combined SEK 2.3 billion. D. Carnegie objected to the way the NDO took over and valued the shares in Carnegie and Max Matthiessen but ultimately lost its appeal through the Swedish administrative process in October 2011. The Swedish state’s support to Carnegie to ensure financial stability in 2008 would be paid back with an estimated surplus generated for the taxpayer in the range of SEK 150 million to SEK 400 million.

Date Revised

2025-04-15

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