Latvia’s ABLV Bank set to be liquidated following regulatory approval

By Caroline Salls

Pittsburgh, June 13 – ABLV Bank, AS, which has €2.4 billion in assets, will be liquidated following approval from the Financial and Capital Market Commission (FCMC) in Latvia, according to a news release.

The bank said acceptance of creditor claims will begin soon. After all claims are lodged, ABLV said it will take at least three months to carry out verification of claims and make a list of creditors.

ABLV said disbursements for depositors with balances in excess of €100,000 as of Feb. 23 could begin in December.

Deposits under €100 000 are already being disbursed, the release said, through a service is ensured by Citadele banka since March.

The bank said an estimated 95% of all deposits could be disbursed by the end of 2020.

The remaining amount of deposits, as well as other claims of the creditors, including claims related to bonds and subordinated claims, will be disbursed under a further course of the liquidation.

In general, the bank said the liquidation process will take an estimated five years.

In the coming days, ABLV said a draft decision on the withdrawal of the bank’s license is going to be prepared and submitted to the European Central Bank. Three days after the license is withdrawn, the liquidators of ABLV will publish a notice of the liquidation, starting a three-month term for lodging creditors’ claims.

Along with the approval of the voluntary liquidation, the members of the bank’s council and board will lose their powers, and the operation will be taken over by a liquidation committee, which will consist of the four liquidators approved by the Financial and Capital Market Commission.

The committee members will include Eva Berlaus, Elvijs Vēbers, Andris Kovaļčuks and Arvīds Kostomārovs.

The liquidators will also be supported by independent experts and international auditor Ernst & Young.

“After 25 years of work put in building this company, it is hard to say these words, yet we are satisfied with the decision made,” former board chairman Erneste Bernis said in the release.

“It is the best possible solution in this situation. Management of the bank will be in the hands of competent, professional and independent team of liquidators, who will do everything to satisfy claims of all creditors to 100%.”

As previously reported, the bank’s shareholders were forced to make a decision on voluntary liquidation in response to the decisions made by the European Central Bank and the Single Resolution Board on Feb. 23, when the ECB decided that ABLV and its subsidiary bank in Luxembourg was failing or likely to fail.

As of April 30, the bank said its liquidity ratio exceeded the minimum required level.

There was about €1 billion in cash held with the Bank of Latvia as of April 30.

At April 30, the bank’s assets amounted to €2.4 billion, while the deposits amounted to €1.6 billion and the loan portfolio €828.3 million.

The bank’s capital and reserves constituted €351.7 million as of April 30.

ABLV Bank is the largest independent private bank in Latvia and is based in Riga.

© 2015 Prospect News.
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