In August, Danske Bank, Denmark's largest lender, said it wrongly collected debt from up to 106,000 customers due to IT system errors and in September admitted it had known about this for years but not properly addressed the problem.
"Danske Bank has had significant errors in debt recovery, which have not been handled satisfactorily," the Danish Financial Supervisory Authority said.
"This has led to the collection of debt from the bank's customers, which the bank was not entitled," it said in a statement released on Thursday.
The FSA has previously given Danske Bank four orders to halt the erroneous debt collection and take measures to rectify its mistakes. It said the aim of the independent investigation was to identify and assess those measures.
Danske Bank Chief Executive Chris Vogelzang said in a statement that it was "absolutely essential" that the steps it took "to clean up this matter have the desired effect".
"Our clear focus has always been to examine the matter thoroughly, correct the errors and compensate all affected customers," Vogelzang said.
(Reporting by Jacob Gronholt-Pedersen; Editing by Alexander Smith)