Financial regulators in eight Nordic and Baltic countries have agreed to share more information about money laundering threats in an effort to fight money laundering and terrorist financing.

Regulators said they plan to develop a coordinated process for exchanging information across Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway, and Sweden. A formal agreement among the agencies is being drafted, the regulators said.

The regulators will establish a permanent working group with representatives from each country’s financial supervisory authority, which will maintain regular contact and exchange information to tackle money laundering and coordinate supervision more effectively. A Memorandum of Understanding (MoU) will be jointly drafted to formalize the continued, long-term cooperation, they said in a joint statement.

The agreement “marks a significant step forward in the combined Nordic-Baltic efforts to combat money laundering and terrorist financing,” Jesper Berg, director general of the Danish Financial Supervisory Authority, said in a statement, while Vytautas Valvonis, director of the supervision service at the Bank of Lithuania, added that “closer cross-border cooperation between supervision authorities plays a key role in strengthening anti-money laundering capacities across the region.”

No other details about the type of information regulators plan to share, or the timing of the formal agreement, however, have yet been provided.

The measures come as a response to the recent—and highly embarrassing—incidences of failings in banks’ money laundering controls in the region.

Sweden’s Swedbank is facing a series of investigations into its handling of customers who displayed potential money laundering risks, while Danske Bank is eager to improve its public standing after it disclosed that U.S. $230 billion of potentially illicit funds, mostly from Russia, may have passed through its Estonian operations (which have since been closed).

The bank’s chief executive, Thomas Borgen, was forced to step down last September following the release of an in-depth independent report it commissioned into what went wrong. The bank is currently being investigated in Denmark, Estonia, the United Kingdom, and the United States, and there is also a strong possibility that it will face legal action from investor groups.

Prior to that, in December 2017, Danske Bank was fined DKr 12.5m (U.S. $2 million) by Danish authorities for violating anti-money laundering rules following an inspection in March 2015 (these were unrelated to the specific allegations in Estonia), while in May 2015 Sweden’s financial services regulator fined Nordea, the region’s largest lender, €4.8 million (U.S. $5.4 million) for lax anti-money laundering controls—the maximum penalty allowed. At the same time, Handlesbanken, the country’s second biggest bank, was handed a €3.3 million (U.S. $3.7 million) fine for similar failings.

In March 2018 the European Central Bank (ECB) pulled the plug on a small Estonian lender, Versobank, for money laundering offences, and Latvia’s third-largest bank, ABLV, is currently in the process of liquidating itself after being accused by the United States of “institutionalized money laundering.”

Such failures prompted the European Commission last September, as part of its “state of the union address,” to announce proposals to strengthen supervision over banks and other financial institutions to toughen up its fight against money laundering and terrorist financing after admitting that present measures have “failed all too often” and that the EU’s approach is hampered by varying levels of supervision and enforcement across EU member states.

The Commission wants to give the European Banking Authority (EBA), the bloc’s supervisory body for the banking sector, a powerful new mandate to monitor what firms are doing to tackle money laundering—with the ability for the EBA to intervene directly if national authorities fail to take appropriate action.

“Our system is as strong as our weakest link,” said the EU’s Justice Commissioner Vĕra Jourová.