It was in July 2018 that ESMA (the European Securities and Markets Authority) fined SEB and a number of other Nordic banks. ESMA alleged that, in their investment analysis of corporate bonds, the banks breached the rules stipulating that only registered Credit Rating Agencies may issue credit ratings. The banks did so by expressing credit quality through the use of an established scale.
SEB appealed the ruling to the Board of Appeal of the European Supervisory Authorities with reference to the Credit Rating Agency Regulation (CRAR), which provides exceptions for recommendations and investment analyses. Several other Nordic banks pursued the same line of argument.
On Wednesday 13 March 2019 the Board of Appeal issued its ruling. The Board of Appeal upheld ESMA's ruling that SEB and other banks must cease their previous practice of using a credit scale in their investment analyses of corporate bonds. However, the Board of Appeal has determined that SEB and other banks did not act negligently. As a result, ESMA will repay the fine it previously assessed.
The ruling may be appealed, but SEB has not yet taken a position on the issue. Since July 2018 the bank has adapted its credit research reports in accordance with ESMA's ruling.