Self-liquidation process of ABLV Bank will be of benefit to Latvia’s economy – expert

RIGA – The self-liquidation process of ABLV Bank will be of benefit to Latvia’s economy, said corporate finance company Prudentia partner Girts Rungainis in an interview with the Latvian public radio on Tuesday.

In his opinion, it is the best possible scenario in ABLV Bank’s case. Rungainis said that both Latvia’s economy and the bank’s owners will benefit from such a scenario. The bank will be able to choose its administrators. So far the liquidation processes have only made the insolvency administrators rich, and nobody else has gained from the process, he said.

He said that the financial situation in the bank is good which means that all clients will be able to recover their funds.

Commenting on Latvia’s financial reputation, Rungainis said that it has never been bright also before the ABLV Bank’s case.

As reported, shareholders of Latvia’s ABLV Bank at an extraordinary meeting on Monday made a decision to start the liquidation process in order to protect interests of its clients and creditors, LETA learned from the bank.

ABLV Bank believes that in this way it will be possible to ensure active protection of its customers, the bank said in a statement.

"Taking into account the previous insolvency and liquidation processes in Latvia, we think this is the best decision possible after the announcement of the European Central Bank (ECB) on launch of the liquidation process. The bank’s financial situation is excellent, therefore must take care of every client," said the bank’s board chairman Ernests Bernis.

"The decision is very tough but the most appropriate one in the given circumstances," said Bernis.

The bank will provide more information on Tuesday.

LETA also reported that the Latvian financial regulator, the Finance and Capital Market Commission, acting on the instructions from the European Central Bank (ECB), has ordered ABLV Bank to stop all payments as of February 19 following a report by the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of Treasury about ABLV Bank's involvement in international money laundering schemes and corruption. On February 24, the Finance and Capital Market Commission made a decision on occurrence of unavailability of deposits at ABLV Bank.