Business News

Latvia takes control of
2nd largest bank
Agence France-Presse . Riga

The Latvian government has effectively nationalised the country’s second-largest bank, Parex Banka — acquiring a controlling 51 per cent stake for the symbolic sum of just a few dollars, Prime Minister Ivars Godmanis said Saturday.
‘The government of Latvia today made a decision that the state will become a majority stakeholder in Parex Banka to secure the stability of Latvia’s financial system and not disturb the work of Parex Banka,’ Godmanis told reporters Saturday evening, following a nine-hour marathon government session.
The government plans to purchase 51 per cent of Parex shares for 2 lats ($3.65) through the state-owned Hipoteku Banka.
The world banking crisis and the management’s inability to handle the situation forced the government’s decision, Finance minister Atis Slakteris said Saturday, further explaining the decision.
‘This was the choice: to allow the bank to go bankrupt or to secure the financial system,’ Slakteris said, further explaining the decision.