In an effort to acquire a majority stake in Unibanka, SEB has been gobbling up shares all year and in mid-August bought an additional 1.5 percent of the company's stock to become the majority shareholder with 50.4 percent in Latvia's largest publicly traded bank.
But it had done so before Latvia's securities commission finished inking regulations that would require majority shareholders to decide to buy the rest or sell.
Under regulations that took effect Sept. 24, SEB would have 30 days to notify minority shareholders of the bank's intentions. SEB, a major voice in Baltic banking with sizable sector interests in all three countries, said the 30-day transition period was too soon and made the commission aware of its feelings.
Responding to criticism from SEB and others that the 30-day transition was too quick, the commission will rethink the ruling this week.
"It will definitely not be 30 days," said commission chairman Viktors Gustsons. "We have to see what will be most beneficial to the market."
The new regulations, designed to protect small investors in takeover attempts, would bring the markets here in line with market regulations in the European Union and elsewhere.
Officials from SEB Baltic Holding, the subsidiary that purchased the shares, would not comment on their intentions.
Some analysts were concerned that SEB was trying to bully the securities commission to bend the rules for one of the largest banking shareholders in the Baltics.
"They had to take into account these new regulations when they increased their stake," said Roberts Idelsons, managing director of the securities brokerage Suprema. "I don't really understand their attitude."
Most analysts are confident that SEB will avoid a buyout of the 18 million shares that, based on the prices SEB paid for previous shares, could be at least $40 million.
"I think they will sell or restructure their stake," said Idelsons. "I don't think there will be any tender offers here."
A Unibanka takeover would be a major step toward intensifying Scandinavian control of the Baltic banking sector begun last year in the aftermath of the Russian economic crisis.
Within the last year SEB purchased the controlling interest in Unibanka, 32 percent of shares in Estonia's No. 2 bank Eesti Uhispank and a 32 percent stake in Vilniaus Bankas, Lithuania's second-largest bank.
Swedbank holds a 49.4 percent stake in Hansabank, the largest in the Baltics.
Baltic banks offer an enticing proposition for Scandinavian banks - expansion throughout the Baltic rim for little risk.
Share prices dropped in the last year, enough that the Baltic acquisitions reportedly account for only 3 percent or 4 percent of SEB's total assets.
For the Baltic banks, the injection of Scandinavian capital helped prop up an ailing banking industry, one that needs big-name backers to compete in the European market, according to analysts.