Nils Melngailis named new Parex CEO

  • 2008-12-10
  • By TBT Staff

TAKING THE REINS: Former Lattelecom CEO Nils Melngailis has officially taken over as the new head of Parex Bank. Melngailis said that he hopes to help the bank raise funds.

RIGA - Nils Melngailis, the former head of Lattelecom communications, has been appointed the new chairman and CEO of Parex Banka. At a press conference on Dec. 8, Melngailis spoke of his goals to stabilize the bank and raise funds to aid in the recovery of Parex Bank as well as all Latvian banks.
 "I hope that I will be able to help in this situation to manage and stabilize the situation in the bank and raise the necessary funds so that not only Parex Bank can continue to operate successfully, but the whole Latvian banking system could start recovering," he said.

After his appointment, Melngailis told reporters that meetings with the IMF and EBRD are considerably important for stabilizing both the economy and the banking sector.
"At this time, consultations with the International Monetary Fund (IMF) and EBRD are key. I have met with IMF officials, and they will do everything possible to support us, however, this help cannot be financial. The government has supported the bank with deposits, but the government itself lacks resources, therefore money from international organizations is important," said Melngailis.

In the press conference, Melngailis told reporters that his chief priority in the first week of his appointment was to establish and maintain communication with bank staff, so operations can continue with no interruptions.
He stated his second task as "stabilizing the situation at Parex" which he said may take some time as "at this time, it is not in the interests of investors to buy," Melngailis told reporters.
Melngailis also mentioned that the formerly frantic withdrawal of money from Parex has considerably slowed.
His third important task, he said, was to continue negotiations with Parex Bank's syndicated lenders. The talks should be completed as soon as possible, as the original concerns about the bank's stability stemmed from the fact that the bank is due to repay its syndicated loans worth 775 million euros next year, Melngailis said at the press conference.

Melngailis, who had left his post at Lattelecom in April to found his own firm, Riga Capital, was elected to the new board of Parex Bank after the acquisition agreement was signed on Dec. 5. Some 84.3 percent of the bank's shares have been transferred to the Mortgage and Land Bank of Latvia, a state held bank.
The government also instructed the Mortgage Bank to find a strategic investor for Parex Bank within a year 's one that would be willing to buy the state-held stake in the bank.

As reported by Diena, Melngailis is expected to receive a salary of 12,000 lats per month, which is comparable to his previous salary at Lattelcom.