It may be almost a year since the collapse of Silicon Valley Bank set off a short-lived financial crisis across the banking industry, but one of its bigger casualties, a $120 billion Swedish pension fund, is still dealing with the effects of the fallout on its C-suite.
Alecta, which handles the pensions of a quarter of Sweden’s population, announced that its new chairwoman of the board, Carina Åkerström, had stepped down from her role just one week into the job.
“It is regrettable that Carina Åkerström has changed her assessment of her ability to fulfill her assignment as Chairman of the Board of Alecta and has chosen to resign,” Kenneth Bengtsson, Alecta’s chair of the nomination committee, said in a statement.
In an unusually cryptic message, Bengtsson said no new information had come to light in the week since Åkerström’s appointment, and that no conflict of interest that “couldn’t be dealt with in the usual way” had emerged.
“During the process, we have of course asked extensive questions to Carina Åkerström about this,” Bengtsson said.
Alecta’s former interim chairman, Jan-Olof Jacke, will return to his role as interim chairperson until the fund finds someone it can keep on a longer-term basis.
A representative for Alecta declined to comment further on the press release.
The abrupt resignation of Åkerström—the former CEO of Swedish bank Svenska Handelsbanken—will do little to quell a widespread crisis of confidence in the embattled fund, which has faced disastrous losses on some of its riskier financial bets.
Alecta still reels from SVB crisis
Alecta has on multiple occasions described 2023 as one of the most turbulent times for the pension fund in its 107-year history.
But the events from the last year would suggest they might still be underselling the level of turmoil inside the fund, which is moving to reduce the risk profile of its bruised portfolio.
Åkerström’s short-lived appointment made her the fund’s first permanent chairperson since October when Ingrid Bonde stepped down in the wake of a crisis sparked by the collapse of SVB last March.
Bonde said there had been “too much focus on my person” in her resignation statement, adding that she needed to “devote my time and energy to my family and my other assignments.”
The fund posted a SEKr 16 billion loss ($1.9 billion) last year thanks to its stake in embattled U.S. Banks SVB, First Republic, and Signature, all of which became virtually worthless as contagion fears tore through the financial sector.
Alecta had previously fired its CEO Magnus Billing in April after the fund revealed its losses from its holdings in the American regional banks, which it said had massively damaged confidence in Alecta’s asset management operations.
C-suite flip flop
Åkerström’s u-turn is just the latest in flip flops at the executive level that have added to a sense of chaos at Alecta.
The board had initially elected former Denmark central bank chief Lars Rohde as Bonde’s successor as chairperson in January, but within a week it had reneged on this appointment.
Alecta said Rohde had accepted a position on the board of another company that bore too many similarities to Alecta, something it was unaware of during the selection process.
At the time of her surprise appointment, Åkerström appeared far from enthusiastic about being thrust into the position of leading the troubled fund.
Åkerström said her appointment was unexpected, but “sometimes unexpected things happen and I’m used to working flexibly.”
Alecta continues to battle bad bets on its investments. Last week, Alecta announced it was writing down $1.2 billion due to losses in its largest single investment, real estate developer Heimstaden Bostad.
The pension fund said the value of its holdings in the indebted landlord had declined 25% in 2023, as a steep jump in interest rates cut hit property valuations and significantly pushed up borrowing costs.
