BN Bank has reviewed its entire portfolio to ensure that there is no age discrimination or other forms of discrimination that entail unfair conditions for groups that have a passive relationship with the bank. Review of pricing in the portfolio will take place periodically, and shall reveal whether indicative prices are representative of the prices the bank actually operates at. The review shall also ensure that customers with the same product and risk profile have the same price regardless of age, speed as a customer or other factors. If significant discrepancies in price are detected between a new and old customer, this difference shall be based on differences in product characteristics, risk or customer relationship in general. If it is not, the bank should take steps to change the price of the customer to the appropriate level without awaiting the customer's initiative.
BN Bank shall be an active driving force for access to banking products that makes life easier for low-access audiences. Examples of such products include Senior loans that provide access to loans for older loan customers with large housing wealth.
Some products such as mortgages/flexi loans and senior loans have elements of flexibility that give customers a freedom, but also have a higher price based on the costs the bank has in providing this flexibility. At BN Bank, we should always advise customers on product choices that are most suitable based on the situation they are in, and always offer customers the most affordable product option that meets their stated needs at the time of purchase.
At BN Bank we should also not price up manual services, or offer inferior terms on products to customer groups that rarely switch banks. For example, if we impose fees on products, older customers should have at least as good terms as younger customers, and they should not actively contact the bank to achieve equal terms in relation to fee freedom or other benefits.
BN Bank saw that the bank's focus on consumer loans, despite controls on applications and sobering credit models, resulted in an increase in the total consumption loan volume in Norway. This is not sustainable. Although the commitment would have resulted in profitability in the long term, the bank therefore chose to stop the provision of borrowing on consumer loans, and only to a limited extent offer refinancing of expensive debt without borrowing. The choice was made because we saw that many customers ended up taking ever more and larger loans, and that contributing to unhealthy debt growth is not compatible with the bank's sustainability goals. Furthermore, we saw a future risk in participating in an unsustainable market.
Based on the bank's ambition to provide fair banking services, and our focus on customers' rights, we have established an independent customer ombudsman. This is an external adviser paid by the bank who will be able to guide our clients if, for example, they end up in payment problems. The purpose is to have an independent party who can assist customers with knowledge of their rights, uncover weaknesses in the bank's process, and opportunities to find solutions. The aim is for this ombudsman to lower the threshold to challenge the bank and ensure a better balance between bank and customer in difficult situations.
Within the corporate market, BN Bank provides only financing of commercial real estate, and residential projects in Norway, and with a focus on the central eastern region. We provide both loans for construction and long-term loans.
Our goal is that we, together with our customers, will influence so that the properties we fund are better mapped to climate profile, and that we highlight the benefits of climate certification of buildings, and investment in improvement measures.
We also have a particular focus on workplace crime and the black economy. This is an area where the construction and real estate industries are particularly vulnerable. Through the guidance of our customers in monitoring and assessing the seriousness of subcontractors, we shall contribute to ensuring that our customers make wise choices and do not expose themselves to unnecessary risk.
Our strategic goal is that the property we fund will have a climate footprint close to the country average. We will work together with partners and suppliers to establish good and transparent goals for status and development in relation to this ambition.
The loan portfolio of the corporate marketing department in BN Bank consists of building loans and loans for commercial buildings. It also includes some mortgages, but this represents a modest scope.
BN Bank has an ambition to prepare its own climate accounts by 2020. As an introduction to this work, we have calculated emissions related to loans to commercial buildings this year. In our calculations we have looked at energy emissions when operating the buildings and that we have looked at the emissions resulting from the activity of the business activities of the tenants.
Our calculations of emissions from commercial buildings are based on figures from Enova building statistics. According to Enova, the emissions from office buildings in 2017 are 179 kWh per square metre. We have summarized rented land and assumed that our buildings have on average the same emissions as commercial buildings in Norway. This gives us emissions equivalent to 0.15 Twh. This accounts for just under 0.5 per cent of the emissions from the service industries in Norway. Office buildings mainly use electricity for heating and operation, but about 20 per cent of the consumption is covered by district heating. Based on figures for emissions from different energy sources, the Bank finds that greenhouse gas emissions related to heating and operation of the buildings amount to 18.6 tonnes of CO2 equivalence.
Within the retail market, the bank has an energy rating close to the national average, but we have a strategic goal of increasing the share with Norwegian energy class A-C from 16% to over 20% by 2024.
BNBank is committed to taking people, the environment and society into account in all its activities. In this lies an obligation to exercise a responsible and good banking craft beyond what follows from financial market legislation.
Responsible marketing of products and services
BN Bank works to offer a wide range of simple banking products to meet the consumer's need for banking in everyday life. Several of these products are marketed in digital surfaces, as well as in printed publications. As a responsible player in the market, this marketing is about creating a match between communication and the delivery itself. In short, we will provide and provide information the consumer can rely on.
Being an actor promoting credit means we have guidelines to follow. The code of conduct can be as strict as the formal legislation, and is something we at BN Bank always have with us when we prepare communications. This means that we need to think about how our marketing is received by customers and the community.
If we move to legislation, the Financial Agreement Act will follow its requirements for information when marketing loans and credit. All advertising of credit is done with a highly visible price example and is within the requirements of good marketing practice.
At BN Bank we have ongoing digital communication with our customers. We ensure that this is a responsible dialogue in which all customers give consent to this communication. This is done regularly in online banking, and here the consent can also be withdrawn. Through the use of consent, we take customer interest in digital direct communication. No customers under the age of 18 receive targeted marketing communications from BN Bank.
Should the customer need to promote/complain about product or delivery, we have a complaint scheme readily available as a shortcut on bnbank.no. The bank has not received complaints about labelling products and services in 2019.
BN Bank relies on trust and should be characterised by the fact that privacy and information security are taken seriously. We will do our utmost so that customers, suppliers, employees and owners can rely on us to safeguard our privacy and information security.
Information security involves adequately protecting data from unwanted actions or events. The requirements for confidentiality, integrity and accessibility shall be safeguarded. The Bank shall have good and appropriate management and control of the personal data managed, and the risk of breach of external and internal rules shall be low. BN Bank has no tolerance for breaches of law and regulations that have been made knowingly. The work to prevent personal data from being compromised is a priority area in information security.
In 2019, 2 discrepancies have been reported to the Norwegian Data Protection Authority in connection with a breach of personal data security. Both discrepancies were due to a breach of confidentiality, in the event of inadvertent disclosure of personal data by e-mail. Steps have been taken in connection with both incidents to prevent similar incidents in the future.
In connection with the implementation of the GDPR in 2019, the Bank's policy on the processing of personal data was revised and adopted by the Bank's Board of Directors. The bank has established a set of templates to help the bank comply with the requirements. The work on training employees and establishing and maintaining good management and deletion routines of personal data is an ongoing priority area of the bank.
The Bank's Data Protection Officer shall ensure that data protection laws and internal privacy policies are complied with and report this to the bank's management and board. The Data Protection Officer acts as a professional adviser. The Ombudsman is responsible for, among other things, the control of compliance, handling of deviations, risk assessment and notifications to the Norwegian Data Protection Authority in the event of unauthorized disclosure of personal data.
In addition to its own control procedures, frameworks and compliance with privacy and information security are included in the audits conducted annually by the bank's internal and external audit.
Existing technology and technological innovations must meet strict security and operational continuity requirements to provide secure services and safeguard value for customers, employees and the bank. At the same time, the services and architecture must be sufficiently sustainable. Large amounts of valuable and sensitive information are handled in the bank. The Bank's Information Security Policy is the management document for safeguarding confidentiality, integrity and availability. The bank's information security manual has incorporated instructions and guidelines for information security work.
It is important that both customers and employees are part of the safeguards in information security and measures to be followed within the ICT area. It is also important that the individual end user of the Services exercises due diligence, good judgment and feel confident in the use of the Services. On its website, the bank has advice on cybersecurity and the use of cards. Employees have mandatory participation in programs that address awareness, training and attitude-enhancing behaviour.
In the event of information security, the ICT regulations are the guiding code for the work being done.
BN Bank shall be a workplace that safeguards gender equality, diversity and workers' rights.
The main message in the bank's HR strategy is the following:
• We will develop the expertise of our employees in a strength-based perspective
• We will develop our leaders to become strategic agents of change
• Together we will attract, develop and keep the best people!
• The bank shall provide good solutions for employees throughout the employee journey.
The HR strategy shall be the foundation in ensuring that BN Bank has motivated and engaged employees who are driven by a desire for the bank to succeed in meeting its goals, and that the bank emerges as an attractive workplace for potentially new employees.
BN Bank has for the first time used the employee survey KulturStyrk prepared by BDO. An interdisciplinary team has prepared an overall action plan for the bank as a whole, and the three focus areas feedback culture, competence and customer journeys/work processes have been highlighted by the employees. Work on the overall action plan and the more departmental measures is well underway, and is already delivering results.
In 2018, the bank established the BN Bank School - an internal competence program for all employees. The basic course in the BN Bank school aims to ensure that new employees get the basic insight they need to quickly feel part of the college and gain insight into their new tasks. Sponsorship scheme for new employees has been established and a brand new start-up programme is being prepared. Vg1 in the BN Bank school shall ensure more department-specific competence raising and is facilitated in cooperation with the head of department and employee representative. In this programme, courses and seminars are tailored to the level that is desirable for us to achieve our strategic objectives. Vg2 consists of external educational courses that provide credits or certifications.
All employees are covered by a collective collective bargaining agreement and 74 per cent of the bank's employees are trade unionised. BN Bank is a member of the Financial Industry Employers' Association and follows the Main Agreement and the Central Agreement entered into with the Financial Association. Workers' pay and working conditions beyond this are regulated in a Enterprise Agreement. BN Bank has in close cooperation with the Financial Association of BN Bank prepared personnel manual, management manual and HSE manual.
The HSE work will contribute to the fact that work processes, and responsibilities and cooperation relationships create well-being and efficiency.
The guidelines pay particular attention to achieving the following sub-goals:
• further develop a good physical and psychosocial working environment
• reduce health loads as a result of the use of computer equipment
• reduce sickness absence with a particular focus on absence that has its cause in the working environment and long-term absence
The bank has a working environment and cooperation committee consisting of representatives from the bank's management and employee representatives.
BN Bank has external corporate health services where, among other things, support is offered in the follow-up of sickness absence and protected rounds are carried out.
The long-term sickness absence in the bank was 3.9 per cent in 2019. In 2018, the long-term sickness absence was 3.7 per cent. The bank follows up sick leave in line with public guidelines. There have been no significant injuries or accidents in 2019.
The bank shall be a workplace with equality between women and men. Of the company's 127 employees, 67 are women and 60 are men. There is a balance between women and men at all levels of employment. The share of women in the group management is 20 per cent, the same as in 2018. 44 per cent of the middle managers in the bank are women, in 2018 the share was 50 per cent. At the end of 2018, BN Bank's board consists of 4 women and 4 men, of whom 1 woman is the employee representative, this is the same distribution as the previous year.
The bank is conscious that it operates in one of the industries with the greatest pay gap between women and men. The bank is committed to giving women and men equal opportunities for development, pay and career, but at the same time puts some limits on internal career paths. The Bank is also conscious of its responsibility to ensure that parental leave does not affect the opportunities for either career or wage development.
According to the Bank's remuneration policy, the Bank follows the equal pay principle, i.e. women and men should be paid equally for the same work or work of equal value. The bank uses the digital tool Factor-based Analysis of Competence In Position (FAKIS), to ensure that the bank places positions of equal value in the same pay frame. The bank's internal auditor reviews the bank's report on compliance with the remuneration policy each year. The equal pay principle is also discussed with union representatives in connection with the annual local wage settlement.
Despite an awareness of equal pay over several years and the fact that the bank is above the industry average, the bank recognises that it can do more to equate pay between the sexes. Equal pay will therefore remain in focus in the years ahead.
BN Bank shall be characterised by a high ethical standard and act correctly and habilt. The Bank's ethics rules form a framework for what BN Bank considers responsible conduct. The Bank has established the following corruption prevention principles:
- the Bank shall strive for a clear culture of transparency around all matters relating to customer care, relationship building, sponsorship, gifts, representation, travel etc.
- all expenses at a travel event shall be recognised correctly and openly
- the level of benefit given to customers in events and other forms of customer care shall clearly be within what is considered legal
- customers should not be invited to attend events and customer care who are in a situation where there have recently been or shall be carried out special negotiations on contracts, deliveries, agreements, credits, investments etc.
- special duty of care applies when participating public employees
The bank conducts annual ethics meetings with all the departments of the bank. Updated code of conduct can be downloaded from the bank's website bnbank.no
A uniform sanctions system has been established in the Bank for handling offences, breaches of ethical guidelines, powers of attorney or other significant breaches of internal procedures and guidelines.
Own notification routine
In connection with the code of conduct, the bank has established its own notification routine. The notification procedures meet the requirements of the Working Environment Act for notification of critical conditions in the business, and the routine facilitates employees to notify anonymously to an external party if desired. By facilitating an external notification routine, the Bank seeks to reduce barriers to reporting internal misconduct, as well as safeguard the right and duty of a worker to issue a report of concern/notification of abusive relationships.
In addition, employees can report harassment and bullying through the annual employee survey. No cases have been reported in 2019.
All governing documents, incident reporting, follow-up of action plans and documentation of various workflow investigations are followed up using the bank's quality management system (EQS). The system has versioning and all documents must be considered and approved periodically. The purpose of this is to ensure that the framework is up to date and accessible to the service needs, as well as to better document changes, action plans, hearings, and decision-makers.
All governing documents shall be reviewed annually. All overall strategy documents, contingency plan for liquidity and solvency, as well as the re-direction plan shall be presented to the Bank's Board of Directors for approval annually.
The bank's incident reporting (discrepancies) is classified according to the Basel Committee's seven main categories. The non-conformity registration has been in operation at the bank since 2010.
The number of registered deviations has been increased since the nonconformance registration was made available to everyone in 2018 in EQS. Non-conformity registration and follow-up is considered to be an important tool for increasing risk awareness in the organisation and creating learning. The Bank seeks to use the events of organisational learning to a greater extent possible, so that errors are not only corrected without routines and training, etc. being assessed. The reporting and follow-up overall shows a good understanding of transparency about events, and for the importance of documenting and using the events for learning for the whole bank.
The Bank has not suffered significant financial losses as a result of non-conformity events in 2019.
BN Bank works systematically and purposefully to uncover and combat organised financial crime, and individuals' attempts at financial gain through criminal acts. BN Bank considers measures in this area to protect BN Bank's finances, reputation and its employees. The bank's overall anti-money laundering guidelines set clear guidelines for how the bank works on the issue, with defined roles and responsibilities for the work.
The concept of economic crime includes the following:
- Money laundering and terrorist financing
- External frauds
- Internal misconduct
BN Bank's financial crime policy includes anti-money laundering and terrorist financing measures, fraud, internal misconduct and corruption. All criminal offences are reported. All employees shall regularly conduct mandatory e-learning on money laundering and terrorist financing.
The anti-money laundering regulations policy includes the bank's obligation to carry out:
- Risk-based customer control
- Investigate suspicious transactions and report to Økokrim
- Establish proper internal control and communication procedures, implement training programmes and designate money laundering
Insight into the bank and its customers' activities is important to ensure a risk-based approach to financial crime and comply with the requirements of the law. The bank shall know what transactions it is common for the customer to make so that we can effectively uncover unusual or suspicious transactions. It must also be documented that control measures are adapted to the relevant risk. Governments, customers and competitors should have confidence in the bank's professionalism and accountability.
The bank is particularly aware that the threat picture has changed with an increased scope of several cross-border transactions and an increased number of foreign customers. The bank is experiencing an increased number of scams and that the scams, both against the bank and the bank's customers, are becoming increasingly sophisticated.
It is a goal of the bank to prevent the bank's products and services from being used in any kind of criminal activity. The bank has a partnership on automatic transaction monitoring with the SpareBank1 group. The bank is also participating in a joint project with the same grouping where artificial intelligence (AI) is used to further improve transaction monitoring.
During 2019, the bank has carried out a comprehensive re-legitimization of its customers in accordance with the requirements set by the Financial Supervisory Authority of Norway. The Bank has received feedback from the Financial Supervisory Authority of Norway that the result of this work is satisfactory.
In 2019, a total of 2,952 transactions were intercepted by the bank's transaction monitoring systems. All of the flagged transactions were assessed by the bank's own anti-money laundering workers, who reported 70 of the suspicious transactions to Økokrim.
In 2019, the Bank has strengthened the organisation and prepared the anchoring of roles and responsibilities related to money laundering. At the same time, according to the requirements of the CRD IV Directive, the bank has employed a separate compliance officer with the right to report directly to the bank's board of directors if necessary.
BN Bank ASA is actively working to reduce its own consumption of energy, which is mainly related to office operations and travel activities. The bank conducts its operations from only two locations, both located in renovated buildings with good environmental standards. The Bank has arranged for meeting activities requiring travel activities to be carried out via technological solutions such as video conferencing and other communication platforms. At the same time, the bank encourages active use of bicycles for travel to and from the workplace, and has facilitated such use through good wardrobe conditions and free towel service for its employees. The bank tries to reduce its consumption of paper and other consumables as much as possible and all waste is either supplied for recycling or handled as special waste.
During 2019, the bank has increased its efforts to raise awareness of its employees about the importance of understanding both its own and the bank's climate footprint. Among other things, the Bank has held its own themed evening on the climate challenges we face and why the financial sector plays an important role in managing these.
The bank is in the process of preparing its own environmental accounts and expects to publish this regularly from 2020.
BN Bank's suppliers and contractual partners shall respect basic requirements for the environment, social conditions and ethical activities. Goods and services delivered to BN Bank shall be manufactured in conditions consistent with the requirements set out in our "Purchasing Sustainability Guidelines". The requirements are based on key UN conventions, ILO conventions and national labour laws at the site of production. Where national laws and regulations cover the same issue as these guidelines, the highest standard shall apply.
BN Bank expects its suppliers to pass on these policies to their subcontractors and contribute to their compliance with them, as well as to work to comply with the requirements on their own behalf. Suppliers and their subcontractors shall remain informed of and comply with the applicable requirements of law, regulation, or other public orders applicable to the supplier's activities and respective responsibilities. The supplier is responsible for having the necessary licences and permits to conduct its activities.
In addition to the general guidelines, procurements will consider whether to use industry-specific sustainability criteria.
Upon request, BN Bank may require suppliers to provide documentation of their environmental performance/environmental management system. When evaluating offers in connection with requests for quotations, BN Bank will emphasise whether the supplier has an environmental management system (equivalent to ISO 14001, Environmental Lighthouse, EMAS).
In 2019, the bank has been in contact with suppliers, which account for about 67 per cent of the bank's total purchases. The majority of these are related to marketing and purchasing IT solutions and consultancy use within IT. In the dialogue, the bank has presented its requirements to suppliers. At the same time, the bank has requested a declaration from the suppliers that they satisfy the bank's requirements. Based on the feedback the bank has received, 99 per cent of the bank's requirements for responsible purchases are met.
Green bonds are loans that will finance environmental purposes. By issuing green bonds, BN Bank will help meet the growing demand from investors for investments in environmentally sustainable projects.
In 2018, SpareBank1 Boligkreditt listed the world's first green mortgage bond on Oslo Børs. This is a green bond with preferential access to energy-efficient housing. BN Bank has transferred around 50 per cent of its mortgages and this portfolio is part of this bond. BN Bank will, through the transfer of mortgages to SpareBank1 Boligkreditt, contribute to the company being able to issue more green bonds and will prefer this rather than issuing green housing bonds themselves.
SpareBank1 Boligkreditt's green bond was certified by the Climate Bond Initiative in June 2018. That same year, it also received a Green-bond rating from rating agency Moody's.
Over the past year, the Bank has also made its first green investment in the bank's liquidity portfolio.
BN Bank is working to launch both green lending and deposit products, but by the end of 2019 has no green products in its product portfolio.