A listening device for processing an input sound to an output sound in order to minimize howI, the listening device comprising • an input transducer for converting the input sound to an electric input signal and • an output transducer for converting a processed electric output signal to the output sound, • a forward path being defined between the input transducer and the output transducer and comprising o a signal processing unit for processing the electric input signal in a number of frequency bands and o an SBS unit for performing spectral band substitution and providing a processed electric output signal, and • an LG-estimator unit for estimating loop gain, LG, in each frequency band of the number of frequency bands thereby identifying plus-bands according to a plus-criterion and minus-bands according to a minus-criterion, wherein - based on an input from the LG-estimator unit - the SBS unit is adapted • for substituting spectral content in a receiver band of the electric input signal with spectral content from a donor band in such a way that spectral content of the donor band is copied and possibly scaled with a scaling function and inserted in the receiver band instead of its original spectral content, wherein the receiver band is a plus-band and the donor band is a minus-band identified by the LG-estimator unit, and • to select the donor band based on a model of the human auditory system to provide minimum distortion, and wherein the listening device comprises a memory wherein predefined distortion factors D ij defining expected distortion when substituting spectral content from donor band i to a receiver band j are stored, and wherein the listening device is adapted to provide that for a given receiver band j, the donor band i having the lowest expected distortion factor D ij is selected for the substitution, whereby the distortion of the processed signal is minimized. • an input transducer for converting the input sound to an electric input signal and • an output transducer for converting a processed electric output signal to the output sound, • a forward path being defined between the input transducer and the output transducer and comprising o a signal processing unit for processing the electric input signal in a number of frequency bands and o an SBS unit for performing spectral band substitution and providing a processed electric output signal, and o a signal processing unit for processing the electric input signal in a number of frequency bands and o an SBS unit for performing spectral band substitution and providing a processed electric output signal, and • an LG-estimator unit for estimating loop gain, LG, in each frequency band of the number of frequency bands thereby identifying plus-bands according to a plus-criterion and minus-bands according to a minus-criterion, • for substituting spectral content in a receiver band of the electric input signal with spectral content from a donor band in such a way that spectral content of the donor band is copied and possibly scaled with a scaling function and inserted in the receiver band instead of its original spectral content, wherein the receiver band is a plus-band and the donor band is a minus-band identified by the LG-estimator unit, and • to select the donor band based on a model of the human auditory system to provide minimum distortion, and