03/16/2023 | Press release | Distributed by Public on 03/16/2023 02:17
Based on the decision taken by the European Central Bank (ECB) on the withdrawal of the licence of Baltic International Bank SE, Latvijas Banka has prepared an application on the opening of the liquidation proceedings of Baltic International Bank SE for the court.
On Wednesday, 15 March, the application was submitted to the Economic Affairs Court, also asking the court to rule on the appointment of sworn advocate Olavs Cers as the bank's liquidator. The Supervision Committee of Latvijas Banka takes the decision on the submission of the application for the liquidation of a credit institution and the approval of the recommended candidate for the position of a liquidator to the court.
As announced earlier, on 12 December 2022, the Financial and Capital Market Commission (FCMC) recognised Baltic International Bank SE as failing or likely to fail, and decided not to take resolution action of Baltic International Bank SE, i.e. to implement no measures to stabilise the bank's operation.
To ensure the stability of Latvia's financial sector and protect the interests of the bank's customers the FCMC Board, during its extraordinary meeting of 12 December 2022, decided to suspend the provision of financial services at Baltic International Bank SE. Meanwhile, on 10 March 2023, the ECB took a decision to withdraw the licence of Baltic International Bank SE. The decision took effect on 11 March. In turn, pursuant to Section 129, Paragraph one of the Credit Institution Law, in such a situation Latvijas Banka has grounds to submit to the court an application for the liquidation of a credit institution and the appointment of a liquidator.
According to the Credit Institution Law, the liquidator of a credit institution, if the credit institution is to be liquidated by a court ruling, may be sworn advocates, sworn auditors or commercial companies whose primary activity is auditing services.
When selecting candidates for the position of a liquidator, Latvijas Banka works together with the Latvian Council of Sworn Advocates and the Latvian Association of Certified Auditors which submit the lists of candidates to Latvijas Banka based on the criteria of professional adequateness. The Supervision Committee of Latvijas Banka evaluates the outlook on managing the bank's liquidation proceedings offered by the candidates, their current experience and available resources, additionally assessing their understanding of anti-money laundering and combating terrorism financing as well as the information received from law enforcement authorities.
Olavs Cers will become the liquidator of Baltic International Bank SE if he is approved as such by the court.
Please note that as of 1 January 2023, the FCMC has been integrated into Latvijas Banka, and, pursuant to Paragraph 4 of the transitional provisions of the Law on Latvijas Banka, Latvijas Banka is the successor of the rights and liabilities of the FCMC.