OREANDA-NEWS. March 29, 2010. Parex banka and financial experts from the international consulting firm Nomura International have prepared detailed business plans for both parts of the restructured bank, which indicate that both parts of the bank will be sustainable and able to fulfil all of their liabilities. Financial projections attest that the new bank will return to profitability already next year, while the existing bank will continue to operate, focusing on the maximum recovery of resources in favour of its shareholders.

In line with the business plan, the new bank will derive a profit in 2011, gradually increasing its deposit portfolio and launching a lending programme. The existing bank, for its part, will cover its liabilities towards borrowers, gradually recovering resources for the bank’s current lending portfolio. Forecast indicators show that both parts of the bank will be attractive to investors. The business plans will be a key part of the restructuring plan that is to be submitted to the European Commission on March 31, as well as to the Financial and Capital Markets Commission in order to license the new bank.

The main objective of the restructuring is to improve the bank’s basic operations in the Baltic States, as well as to return the bank to the private sector so that its operations have a positive effect on the economic recovery process in Latvia. Management of the problematic part of the bank’s lending portfolio will be split off to maximise the recovery of those resources. The decision on Parex banka’s restructuring model was taken on 23 March, based on the European Commission guidelines on state aid to financial institutions.