OREANDA-NEWS. On 8 September 2009 was announced, that 25 percent and one share of Parex Banka were transferred from the Latvian Privatisation Agency to the European Bank for Reconstruction and Development (EBRD). In this initial transaction, the EBRD acquired 51,444,325 ordinary shares. As a part of a future capital increase at Parex Banka, the EBRD plans to purchase further 6,062,500 shares, thus maintaining its stake of 25 percent and one share.

The share purchase fee is equivalent to the share face value*. The changes in the shareholder register will be made in the immediate future.

The EBRD’s investment in the equity capital together with a €22 million subordinated loan will strengthen the capital base of Parex Banka and support its restructuring and return to profitability and the private sector.

“By becoming a shareholder of the bank the EBRD marks a significant stage in stabilization of the bank and indicates about the development potential for Parex Banka. Latvia recognizes the experience of the EBRD in the banking sector and planned support to the entrepreneurs of Latvia,” emphasized Prime Minister, Valdis Dombrovskis.

As reported earlier, on 16 April 2009, the President of the EBRD, Thomas Mirow and Prime Minister of Latvia, Valdis Dombrovskis, Chairman of Parex Banka’s Management Board, Nils Melngailis and Chairman of the Privatisation Agency, Arturs Grants signed Share Purchase Agreements providing that following the increase of equity capital the EBRD will purchase 57,506,825 ordinary shares comprising 25 percent and 1 share of Parex Banka’s equity capital. On 23 July 2009, Peter Reiniger, Business Group Director for Central Europe and the Western Balkans from the European Bank for Reconstruction and Development visited Latvia to sign the subordinated loan agreement with Parex Banka.

To date the EBRD has committed close to € 450 million to the Latvian economy in various projects in the financial, corporate, energy and infrastructure sectors.

The approximate EBRD’s investment will constitute LVL 51 444 325.