RIGA — Two major Latvian newspapers have published stories citing an unpublished report that the split portion of the nationalized Parex Bank with bad assets will be bankrupted, but Prime Minister Valdis Dombrovskis denies this.

Last month Latvia’s government decided to split Parex Bank, the troubled financial institution it nationalized late in 2008, into two parts in order to [private_supervisor]improve chances for a privatization as recommended by consultancy firm Nomura International. The full plan has been obtained and is available here.

This week both the Neatkarīgā Rīta Avīzes and Telegraf newspapers reported that the secret plan is to bankrupt the bad asset institution, which would leave creditors out to dry for as much as 1.5 billion lats (€1.1 billion). The newspapers also reported that Nomura considers finding a buyer for the bad assets, which include a number of Baltic real estate deals gone bad, to be impossible.

Dombrovskis denied that the Cabinet has made any such decision via his press secretary Līga Krapāne on Tuesday.

“The bank’s interest in potential buyers is much broader than in the Nomura presentation and disclosure is limited by potential buyers, as concluded confidentiality agreements are in force pending their decision,” Krapāne told the press. “The decision of the bank restructuring model has contributed to the interest of investors.”

The government has dumped more than €1 billion into propping up Parex, and the debate whether it would have been better to let the bank collapse is still waged. Meanwhile the secrecy of the nationalization process has come under harsh criticism by the president and state auditor. A criminal probe into whether possible wrongdoing by government institutions was committed in the takeover of Parex Bank remains ongoing.

In other news, a proposal to abolish monthly interest payments for the two founders and former owners of Parex Bank Viktor Krasovitsky and Valery Kargin moved forward to a second hearing in the parliament this week.

— Baltic Reports reporter James Dahl contributed to this report. [/private_supervisor] [private_subscription 1 month]improve chances for a privatization as recommended by consultancy firm Nomura International. The full plan has been obtained and is available here.

This week both the Neatkarīgā Rīta Avīzes and Telegraf newspapers reported that the secret plan is to bankrupt the bad asset institution, which would leave creditors out to dry for as much as 1.5 billion lats (€1.1 billion). The newspapers also reported that Nomura considers finding a buyer for the bad assets, which include a number of Baltic real estate deals gone bad, to be impossible.

Dombrovskis denied that the Cabinet has made any such decision via his press secretary Līga Krapāne on Tuesday.

“The bank’s interest in potential buyers is much broader than in the Nomura presentation and disclosure is limited by potential buyers, as concluded confidentiality agreements are in force pending their decision,” Krapāne told the press. “The decision of the bank restructuring model has contributed to the interest of investors.”

The government has dumped more than €1 billion into propping up Parex, and the debate whether it would have been better to let the bank collapse is still waged. Meanwhile the secrecy of the nationalization process has come under harsh criticism by the president and state auditor. A criminal probe into whether possible wrongdoing by government institutions was committed in the takeover of Parex Bank remains ongoing.

In other news, a proposal to abolish monthly interest payments for the two founders and former owners of Parex Bank Viktor Krasovitsky and Valery Kargin moved forward to a second hearing in the parliament this week.

— Baltic Reports reporter James Dahl contributed to this report. [/private_subscription 1 month] [private_subscription 4 months]improve chances for a privatization as recommended by consultancy firm Nomura International. The full plan has been obtained and is available here.

This week both the Neatkarīgā Rīta Avīzes and Telegraf newspapers reported that the secret plan is to bankrupt the bad asset institution, which would leave creditors out to dry for as much as 1.5 billion lats (€1.1 billion). The newspapers also reported that Nomura considers finding a buyer for the bad assets, which include a number of Baltic real estate deals gone bad, to be impossible.

Dombrovskis denied that the Cabinet has made any such decision via his press secretary Līga Krapāne on Tuesday.

“The bank’s interest in potential buyers is much broader than in the Nomura presentation and disclosure is limited by potential buyers, as concluded confidentiality agreements are in force pending their decision,” Krapāne told the press. “The decision of the bank restructuring model has contributed to the interest of investors.”

The government has dumped more than €1 billion into propping up Parex, and the debate whether it would have been better to let the bank collapse is still waged. Meanwhile the secrecy of the nationalization process has come under harsh criticism by the president and state auditor. A criminal probe into whether possible wrongdoing by government institutions was committed in the takeover of Parex Bank remains ongoing.

In other news, a proposal to abolish monthly interest payments for the two founders and former owners of Parex Bank Viktor Krasovitsky and Valery Kargin moved forward to a second hearing in the parliament this week.

— Baltic Reports reporter James Dahl contributed to this report. [/private_subscription 4 months] [private_subscription 1 year]improve chances for a privatization as recommended by consultancy firm Nomura International. The full plan has been obtained and is available here.

This week both the Neatkarīgā Rīta Avīzes and Telegraf newspapers reported that the secret plan is to bankrupt the bad asset institution, which would leave creditors out to dry for as much as 1.5 billion lats (€1.1 billion). The newspapers also reported that Nomura considers finding a buyer for the bad assets, which include a number of Baltic real estate deals gone bad, to be impossible.

Dombrovskis denied that the Cabinet has made any such decision via his press secretary Līga Krapāne on Tuesday.

“The bank’s interest in potential buyers is much broader than in the Nomura presentation and disclosure is limited by potential buyers, as concluded confidentiality agreements are in force pending their decision,” Krapāne told the press. “The decision of the bank restructuring model has contributed to the interest of investors.”

The government has dumped more than €1 billion into propping up Parex, and the debate whether it would have been better to let the bank collapse is still waged. Meanwhile the secrecy of the nationalization process has come under harsh criticism by the president and state auditor. A criminal probe into whether possible wrongdoing by government institutions was committed in the takeover of Parex Bank remains ongoing.

In other news, a proposal to abolish monthly interest payments for the two founders and former owners of Parex Bank Viktor Krasovitsky and Valery Kargin moved forward to a second hearing in the parliament this week.

— Baltic Reports reporter James Dahl contributed to this report. [/private_subscription 1 year]

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