RIGA - Baltikums, one of Latvia's smallest banks, last week announced that it had received permission from the Finance and Capital Market Commission to issue 5 million euros' worth of bonds.
Baltikums, which ranked 20th among Latvia's 23 banks in terms of assets, will offer to the public 50,000 bonds with a face value of 100 euros. Maturity will be Dec. 26, 2006 and the interest payment will be six-month EURIBOR plus 3.5 percent.
According to the Baltikums prospectus on the FCMC Web site, the public offering must begin no earlier than Dec. 1 and close on Dec. 21.
"Funds raised through the bond issue will be used by Baltikums to provide its main services. Proceeds from the bond issue will be applied mostly toward increasing the issuer's loan portfolio," the prospectus stated.
To date several Latvian banks have issued bonds, including Latvijas Unibanka, Nord/LB Latvija and Maras Banka, whereas Baltic Trust Bank and Latvijas Krajbanka have said they are considering such a possibility.
Baltikums had a 287,000 lat (416,000 euro) profit in the first nine months of 2004, up 40 percent or 82,000 lats on the same period last year. The bank's assets in the nine months swelled 28 percent or 8.75 million lats to 39.54 million lats as of Sept. 30.