Nordea Bank, a Nordic financial services group, has announced plans to re-domicile its parent company to Finland from Sweden.

The re-domiciliation will be implemented through a downstream cross-border merger, under which Nordea Bank will be merged into a newly launched Finnish subsidiary.

The merger is expected to be completed during the second half of 2018, subject to regulatory and shareholder approval.

Nordea said that domiciling its parent to a country that is a banking union member will ensure it is subject to the same regulatory framework as other European banks and will offer a more level playing field.

The banking group expects the move to affect a “limited number of employees” and also assured that all its businesses in the Nordic home markets will remain unchanged. With the move, the bank also expects to reap savings of around €1bn in the longer term.

Nordea Bank chairman of the board of directors Bjorn Wahlroos said: “The Board’s decision to initiate the re-domiciliation of the parent company to Finland is the outcome of six months of careful study and analysis of the competitive conditions and challenges facing Nordea.

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“We see the move as an important strategic step in positioning Nordea on a par with its European peers. The level playing field and predictable regulatory environment offered by the banking union are, we believe, in the best interest of Nordea’s customers, shareholders and employees.”