Total amount of the bank’s liabilities towards Latvia does not increase,
no additional funding is required for carrying out the transaction

Today, on 28 December, in accordance with the restructuring plan of joint stock company Parex banka and decision passed by the Cabinet of Ministers on 30 November 2010, the bank’s core capital was increased for the amount of 9.7 million. The purpose of this transaction is to ensure Parex banka’s performance of capital sufficiency indices. 

Parex banka’s core capital was increased by 9’700’000 Lats by the means of closed share emission, thus emitting 9'700'000 registered shares with voting rights. Nominal value of each emitted share is one Lat. State joint stock company Privatization Agency purchased the emitted shares, thus increasing participation of the State in Parex banka’s core capital.  After registering changes in Commercial Register of the Republic of Latvia, State joint stock company Privatization Agency will own 82% of Parex banka’s shares and the European Bank for Reconstruction and Development will own 15%.

Proportion of shares with voting rights after increase of core capital, on its part, is as follows: 79% of shares with voting rights are owned by State joint stock company Privatization Agency and accordingly 19% are owned by the European Bank for Reconstruction and Development.

Part of accrued interest for State term-deposits located in the bank has been used for increasing Parex banka's core capital, therefore additional funding was not necessary for carrying out this transaction. The total amount of Parex banka’s liabilities towards Latvia has not changed as a result of the transaction.
 
About Parex banka:
Parex banka is structured as a solution bank whose main task is to maximize recovery of the investments made by the State within the determined deadline. In order to achieve its goals, Parex banka focuses on recovery of assets, efficient restructuring of loans and management of real estate that has served as security for loans. Along with planning purposeful increasing of the value of assets, Parex banka also performs professional management of overtaken real estate and as soon as real estate market recovers, the bank will sell it at the best price possible in the interests of the State and tax payers.

Additional information:
Marita Ozoliņa-Tumanovska
Head of Communication and Marketing
Telephone: 67779142 or 29287169
E-mail: Marita.Ozolina@parex