Carnegie Investment Bank
Encyclopedia
Carnegie Investment Bank AB is a Swedish
financial services group with activities in securities brokerage, investment banking
and private banking
.
Founded in 1803, Carnegie is headquartered in Stockholm
with offices across the Nordic region, as well as in London
, New York
, Luxembourg
and Geneva
. The company has market leading positions in equities research and brokerage, corporate finance advisory
and private wealth management
. Carnegie’s customers include institutional investors, corporates, financial institutions, private equity firms
, governments and high net worth individual
s. In 2008 Carnegie had revenues of SEK 2.7 billion and as of 31 December 2008 assets of SEK 14.8 billion. Assets under management
amounts to SEK 110 billion and the number of employees is approximately 900 as of 3 September 2010.
In the wake of the economic crisis of 2008 Carnegie Investment Bank AB was nationalized on November 10, 2008. In May 2009, the bank was acquired in a joint venture by the private equity company Altor Equity Partners
and the investment company Bure Equity
. The ambition is to re-establish Carnegie as the leading independent investment bank in the Nordic region.
, founded D. Carnegie & Co AB in Gothenburg
. The management of the company was later succeeded by Carnegie's nephew, David Carnegie Jr., who later returned to Scotland
, leaving the company, which by then had considerable interests in brewing
and sugar
production, in the hands of Oscar Ekman. When David Carnegie, Sr. died in 1890, Ekman inherited a substantial amount of shares and obtained majority ownership of the company. In 1907 the company was once again taken over, this time by Ekman's son-in-law
Karl Langenskiöld, whereupon the formerly brewing and sugar businesses were divested. In the wake of the Kreuger crash
, Langenskiöld founded a brokerage business in his name, Bankirfirman Langenskiöld, which is the foundation that the Carnegie of today rests upon.
In 1980 the company retrieved its name Carnegie. By this time financier Erik Penser
held the controlling interest of the company. In 1988 Carnegie was taken over by what later became Nordea
and remained in their hands until 1994, when a newly formed company, Carnegie Holding, bought the bank. The new holding company
was to 55 % owned by British
merchant bank
Singer & Friedlander and to 45 % owned by Carnegie's employees. In 2001, Carnegie Holding company was merged with D. Carnegie & Co, making the latter the parent company in the Carnegie Group. The company was listed on the Stockholm Stock Exchange
, but was delisted in connection with the nationalization. Since 2004, business is operated through Carnegie Investment Bank.
on November 10, 2008. The bank had crossed the restrictions from the Swedish supervisory authority, Finansinspektionen, when lending too high of a sum to one client, property magnate Maths O. Sundqvist. The largest shareholders at the time were Böös & Enblad AB (9,2%), Moderna Finance AB (6,4%) and Harris Associates fonder (5,3%). In May 2009, the private equity company Altor Equity Partners
and the investment company Bure Equity
acquired the company.
On September 3, 2010, it was announced that Carnegie was to acquire HQ Bank, a strategic move with the aim to further strengthen its private banking division.
Sweden
Sweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....
financial services group with activities in securities brokerage, investment banking
Investment banking
An investment bank is a financial institution that assists individuals, corporations and governments in raising capital by underwriting and/or acting as the client's agent in the issuance of securities...
and private banking
Private banking
Private banking is banking, investment and other financial services provided by banks to private individuals investing sizable assets. The term "private" refers to the customer service being rendered on a more personal basis than in mass-market retail banking, usually via dedicated bank advisers...
.
Founded in 1803, Carnegie is headquartered in Stockholm
Stockholm
Stockholm is the capital and the largest city of Sweden and constitutes the most populated urban area in Scandinavia. Stockholm is the most populous city in Sweden, with a population of 851,155 in the municipality , 1.37 million in the urban area , and around 2.1 million in the metropolitan area...
with offices across the Nordic region, as well as in London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
, New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
, Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
and Geneva
Geneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...
. The company has market leading positions in equities research and brokerage, corporate finance advisory
Corporate finance
Corporate finance is the area of finance dealing with monetary decisions that business enterprises make and the tools and analysis used to make these decisions. The primary goal of corporate finance is to maximize shareholder value while managing the firm's financial risks...
and private wealth management
Wealth management
Wealth management is an investment advisory discipline that incorporates financial planning, investment portfolio management and a number of aggregated financial services...
. Carnegie’s customers include institutional investors, corporates, financial institutions, private equity firms
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
, governments and high net worth individual
High net worth individual
A high-net-worth individual is a person with a high net worth. In the private banking business, these individuals typically are defined as having investable assets in excess of US$1 million. As explained below, the U.S...
s. In 2008 Carnegie had revenues of SEK 2.7 billion and as of 31 December 2008 assets of SEK 14.8 billion. Assets under management
Assets under management
Assets under management is a financial term used denote the market value of funds being managed by a financial instutition on behalf of its clients, investors, depositors, etc. This metric is a sign of size and success against competition...
amounts to SEK 110 billion and the number of employees is approximately 900 as of 3 September 2010.
In the wake of the economic crisis of 2008 Carnegie Investment Bank AB was nationalized on November 10, 2008. In May 2009, the bank was acquired in a joint venture by the private equity company Altor Equity Partners
Altor Equity Partners
Altor Equity Partners is a private equity firm focused on leveraged buyout and growth capital investments in Sweden, Denmark and Norway.The firm, which is based in Stockholm, Sweden, was founded in 2003 by a team led by Harald Mix, formerly a partner at Industri Kapital, another Nordic-focused...
and the investment company Bure Equity
Bure Equity
Bure Equity is an investment company involved in communications, textiles, training, and education. It is largest private school operator in Sweden. This role gained it international attention in connection to the rise of independent schools in Sweden...
. The ambition is to re-establish Carnegie as the leading independent investment bank in the Nordic region.
Background
Carnegie was established as a trading company in 1803 when David Carnegie, Sr., a ScotsmanScotland
Scotland is a country that is part of the United Kingdom. Occupying the northern third of the island of Great Britain, it shares a border with England to the south and is bounded by the North Sea to the east, the Atlantic Ocean to the north and west, and the North Channel and Irish Sea to the...
, founded D. Carnegie & Co AB in Gothenburg
Gothenburg
Gothenburg is the second-largest city in Sweden and the fifth-largest in the Nordic countries. Situated on the west coast of Sweden, the city proper has a population of 519,399, with 549,839 in the urban area and total of 937,015 inhabitants in the metropolitan area...
. The management of the company was later succeeded by Carnegie's nephew, David Carnegie Jr., who later returned to Scotland
Scotland
Scotland is a country that is part of the United Kingdom. Occupying the northern third of the island of Great Britain, it shares a border with England to the south and is bounded by the North Sea to the east, the Atlantic Ocean to the north and west, and the North Channel and Irish Sea to the...
, leaving the company, which by then had considerable interests in brewing
Brewing
Brewing is the production of beer through steeping a starch source in water and then fermenting with yeast. Brewing has taken place since around the 6th millennium BCE, and archeological evidence suggests that this technique was used in ancient Egypt...
and sugar
Sugar
Sugar is a class of edible crystalline carbohydrates, mainly sucrose, lactose, and fructose, characterized by a sweet flavor.Sucrose in its refined form primarily comes from sugar cane and sugar beet...
production, in the hands of Oscar Ekman. When David Carnegie, Sr. died in 1890, Ekman inherited a substantial amount of shares and obtained majority ownership of the company. In 1907 the company was once again taken over, this time by Ekman's son-in-law
Son-in-Law
Son-in-Law was a British Thoroughbred racehorse and an influential sire, especially for sport horses.The National Horseracing Museum says that Son-in-Law is "probably the best and most distinguished stayer this country has ever known." Described as "one of the principal influences for stamina in...
Karl Langenskiöld, whereupon the formerly brewing and sugar businesses were divested. In the wake of the Kreuger crash
Ivar Kreuger
Ivar Kreuger was a Swedish civil engineer, financier, entrepreneur and industrialist. In 1908 Kreuger co-founded the construction company Kreuger & Toll Byggnads AB which specialized in new building techniques. By aggressive investments and innovative financial instruments he built a global match...
, Langenskiöld founded a brokerage business in his name, Bankirfirman Langenskiöld, which is the foundation that the Carnegie of today rests upon.
In 1980 the company retrieved its name Carnegie. By this time financier Erik Penser
Erik Penser
Nils Wilhelm Erik Penser is a Swedish financier and businessman.After having studied law at Lund University, Erik Penser commenced a career as a stock broker at Bankirfirman Langenskiöld, which later became Carnegie Investment Bank...
held the controlling interest of the company. In 1988 Carnegie was taken over by what later became Nordea
Nordea
Nordea Bank AB is a Stockholm-based financial services group operating in Northern Europe. The bank is the result of the successive mergers and acquisitions of the Swedish, Finnish, Danish and Norwegian banks of Nordbanken, Merita Bank, Unibank and Kreditkassen that took place between 1997 and 2000...
and remained in their hands until 1994, when a newly formed company, Carnegie Holding, bought the bank. The new holding company
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
was to 55 % owned by British
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
merchant bank
Merchant bank
A merchant bank is a financial institution which provides capital to companies in the form of share ownership instead of loans. A merchant bank also provides advisory on corporate matters to the firms they lend to....
Singer & Friedlander and to 45 % owned by Carnegie's employees. In 2001, Carnegie Holding company was merged with D. Carnegie & Co, making the latter the parent company in the Carnegie Group. The company was listed on the Stockholm Stock Exchange
Stockholm Stock Exchange
The Stockholm Stock Exchange is a stock exchange located in Stockholm, Sweden. Founded in 1863 it is the primary securities exchange of the Nordic Countries....
, but was delisted in connection with the nationalization. Since 2004, business is operated through Carnegie Investment Bank.
Organisation
The company is divided into three divisions; Securities (equity research, sales and trading), Investment Banking (corporate finance advisory and capital markets activities) and Private Banking. The asset management division was divested in 2010.Ownership
In the wake of the economic crisis of 2008, Carnegie Investment Bank AB was, to avoid bankruptcy, taken over by the Swedish National Debt OfficeSwedish National Debt Office
The Swedish National Debt Office founded by the Riksdag of the Estates in 1789, is a Government agency in Sweden. The first task of the Debt office was to finance the War against Russia started by King Gustav III....
on November 10, 2008. The bank had crossed the restrictions from the Swedish supervisory authority, Finansinspektionen, when lending too high of a sum to one client, property magnate Maths O. Sundqvist. The largest shareholders at the time were Böös & Enblad AB (9,2%), Moderna Finance AB (6,4%) and Harris Associates fonder (5,3%). In May 2009, the private equity company Altor Equity Partners
Altor Equity Partners
Altor Equity Partners is a private equity firm focused on leveraged buyout and growth capital investments in Sweden, Denmark and Norway.The firm, which is based in Stockholm, Sweden, was founded in 2003 by a team led by Harald Mix, formerly a partner at Industri Kapital, another Nordic-focused...
and the investment company Bure Equity
Bure Equity
Bure Equity is an investment company involved in communications, textiles, training, and education. It is largest private school operator in Sweden. This role gained it international attention in connection to the rise of independent schools in Sweden...
acquired the company.
On September 3, 2010, it was announced that Carnegie was to acquire HQ Bank, a strategic move with the aim to further strengthen its private banking division.