RIGA - The American consumer lending company GE Money signed an agreement on Oct. 13 to acquire a 98 percent stake in Latvia's Baltic Trust Bank (BTB). The deal is expected to be completed by November, pending government approval. "The decision to acquire BTB shares was made in order to continue the development and expansion of GE Money in Latvia," said GE Money Nordic and Baltic region head Niels Aall.
In the two years since GE Money launched operations in Latvia, the company has grown and developed rapidly, he said, adding that acquiring a bank would allow the company to offer a wide range of banking services.
"We are honored to join up with one of the most successful international financial corporations. GE's choice demonstrates a level of high interest and the meaningful development of Latvia's market. In my opinion, the Bank and its clients will secure large growth opportunities with this deal," commented BTB board chairman Edgars Dubras.
The sum of the deal has not yet been revealed.
Gunta Linde, board chairman of Finstar Baltic Investments, current owner of BTB, told the Baltic News Service that she was not authorized to comment on the acquisition.
Finstar Baltic Investments, which is co-owned by Russian millionaire Oleg Boiko (52.1 percent) and the Cyprus-registered Wolff Investments Limited (47.85 percent), owns 94.2 percent of BTB. The bank's share capital is 15.6 million lats (22.2 million euros).
In August, BTB was ranked number 13 among Latvia's 24 banks in terms of assets. The bank has one of the largest branch networks, with 74 branches across Latvia. In the first eight months of this year, the bank registered 3.3 million lats in profit. From January to August of this year, the bank totaled 249.9 million lats in assets.
GE Money is a part of the world's largest consumer lending corporation, GE Consumer Finance, owned by America's General Electric. The company began Latvian operations in May 2004, when it purchased the consumer lending company RD Lizinga Grupa.
GE Money made 2.1 million lats in profit last year, up almost three-fold from 2004. The company's credit portfolio was 42.2 million lats as of the end of last year, growing 250 percent per year.