Sweden’s HQ Bank, which counts private banking among its services, is to be liquidated following the revocation of its banking licence by the Swedish Financial Supervisory Authority.

HQ Bank’s licence was reportedly pulled due to accounting and capital requirement violations, specifically the understatement of losses at its now-closed trading operations which meant that the bank had been under-capitalised since the end of 2008.

The bank said in a statement that over the weekend its board had sought to join forces with another party holding an existing banking licence so that HQ Bank could continue to operate. However, “an almost completely agreed solution with such a party has proven impossible to implement,” the bank said. Such a deal would have required the regulator to review its decision to revoke HQ Bank’s licences if it had changed ownership, the statement continued.

In another statement on its closure, HQ Bank said that it is not insolvent and has “good financial strength and liquidity”, adding that clients' money is entirely separated from the bank’s own funds and will be unaffected by the bank’s liquidation.