Owership changes again at Latvia’s LBB

  • 2013-05-29
  • From wire reports

RIGA - Russian financier Andrey Vdovin, one of the co-owners of the VMHY Group, has purchased 100 percent of Latvijas Biznesa Bank (Latvian Business Bank, LBB) shares, reports Nozare.lv. The VMHY group includes Russian commercial banks M2M Private Bank and ATB Bank.
M2M Private Bank specializes in servicing wealthy clients and its board chairman is Robert Idelson, who has long experience in Latvia’s financial sector. M2M Asset Management, which is also a part of the VHMY Group, operates in Latvia as well.

The transaction took place on May 21 and changes have already been registered in the register of LBB shareholders.
The Financial and Capital Market Commission has granted permission to Vdovin for the acquisition of a significant share in the bank, the commission’s representative Laima Auza said. The commission’s approval will also be required in the event of replacing the bank’s board or council.

A new bank will be established on the basis of LBB, specializing in servicing the private capital of wealthy international and Latvian clients, said M2M Asset Management marketing and communications department head Julia Kondratovich.
The new bank’s business development strategy will be based on providing private banking services, servicing client banking operations and the transactions of companies belonging to these clients, capital management, and lifestyle services.

It is planned that LBB will be fully restructured by Aug. 1.
Vdovin says that the acquisition of LBB is hoped to consolidate MT2M group’s positions on the European market of private asset management services, where M2M Asset Management is already represented. He is very optimistic about the development of LBB’s international private banking services, saying that many clients of M2M Private Bank want the bank to also handle their international banking operations and capital.
Latvia is one of the key Eastern European financial centers with stable banking traditions and professional banking sector regulations, believes Vdovin. “We are confident that LBB will be able to offer clients high-quality banking services and modern financial instruments for capital gains, and they will be in high demand with international and Latvian private clients,” he notes.

Vdovin has been working in the banking sector for more than twenty years. He is chairman of the M2M Private Bank council of directors and M2M Asset Management council, member of insurance company Gelios council and of the ATB Bank council.
The owners of VHMY Group are Vdovin, Pavel Maslovsky, Peter Hambro and Kirill Yakubovsky, each with a 25 percent stake.

This past April, M2M Private Bank’s assets stood at 26.6 billion rubles (645.7 million euros), capital at 3.2 billion rubles, a loan portfolio of 12.5 billion rubles, according to the bank’s Web site.
LBB was established in 1992. The bank’s former shareholders are Russian credit institutions Mosbiznesbank and the Bank of Moscow. In April 2011, Russian businessman Andrey Molchanov acquired 99 percent of LBB shares. Last June, he sold part of LBB shares to various Cyprus-registered companies: 9.23 percent to Splingix Limited, 9.23 percent to Mankind Management Limited, 8.77 percent to Circuitland Developments Ltd., 8.77 percent to Valyse Limited, 7.04 percent to Adminprase Limited and 6.93 percent to Cernevix Limited.

LBB losses in the first quarter this year amounted to 355,801 lats (597,000 euros). Last year, the bank posted 1.8 million lats in losses. The bank’s assets stood at 4.2 million lats at the end of 2012. Former Latvian Mortgage and Land Bank head Inesis Feiferis is chairman of the bank’s board.

Last year LBB was the 25th largest bank in Latvia in terms of assets.