Approximately 700 Latvian residents among depositors of Baltic International Bank

RIGA - Baltic International Bank, whose operations have been suspended in accordance with the decision of the Financial and Capital Market Commission (FCMC), has about 1,580 clients with deposits with the bank, including about 700 Latvian residents, the commission's chairwoman Santa Purgaile said at a press conference on Tuesday.

She explained that most depositors will receive the full guaranteed compensation of their deposits.

Purgaile also noted that the FCMC is currently looking for a solution to pay the bank's depositors the guaranteed deposits, and it is possible that this will be done without the mediation of another credit institution.

She also explained that the total amount of deposits and how much will have to be paid out in guaranteed compensation are still being specified. According to operational data, the bank's assets are sufficient to repay the compensations paid to the Deposit Guarantee Fund.

According to the information available to the FCMC, on December 2, 280 Baltic International Bank customers had a bank account balance of zero. According to the Law on Deposit Guarantees, the state guarantees payment of compensation for all types of deposits up to 100,000 euros. According to preliminary estimates, 1,012 bank customers will receive their deposits in full in the form of guaranteed compensation.

Evaluating the impact on society, the FCMC decided not to carry out bank resolution or stabilization of the bank's operations. Purgaile said that considering the fact that the bank is one of the smallest in Latvia and has a small number of customers, the bank's closure will not have an impact on the financial sector.

As reported, the Board of the FCMC at an extraordinary meeting on Monday decided to suspend the provision of financial services at Baltic International Bank.

The financial supervisory authority has recognized Baltic International Bank as failing or likely to fail and decided not to take resolution action of Baltic International Bank, which means to take no action in order to stabilize the bank's activities.

A unit of special tasks police force on Monday evening raided Baltic International Bank in Riga Old City, breaking the entrance door of the bank's head office, LETA observed.

According to unconfirmed information, police were searching also the residences of the bank's managers.

At the end of 2021, Baltic International Bank was the tenth largest bank in Latvia in terms of assets. The bank's largest shareholders were Valeri Belokon (38.13 percent) and Vilori Belokon (21.3 percent).

In the first nine months of this year, Baltic International Bank posted EUR 7.186 million in loss, 3.6 times more than in the respective period last year. The banks assets as of September 30, 2022, stood atr EUR 195.29 million or by 7.1 percent or EUR 14.88 million less than at the end of 2021.