The Deposit Guarantee Fund is sufficient to pay compensations to affected PNB Bank clients. This means not a cent from Latvia’s state budget will be used, said Latvia’s Finance Minister Janis Reirs.
Reirs stressed that Latvia’s deposit guarantee system was secure and it was commendable that 99.2% of PNB Bank’s depositors would be able to get their money back. He also added that the amount to be paid to affected clients of the bank provided no reasons for concern over resources available in the Deposit Guarantee Fund – the paid amount would be recovered using assets from PNB Bank. There are also other mechanisms that provide resources for the fund. However, currently there is no need to use said mechanisms.
Reirs stressed that PNB Bank’s case was not in any way related to recommendations from Moneyval and money laundering. The problem in this case is the bank lacks capital, which is why the decision was made on halting the bank’s operations.
The minister is aware the European Central Bank has spoken with PNB Bank’s shareholders about capital recovery. Reirs concluded that talks were not successful.
The minister also added that ECB took charge over PNB Bank’s supervision, because the bank had entered litigation process with the Latvian state. (BNN/Business World Magazine)
