Parex Banka Repays 117,6 mln Lats to Bank of Latvia
OREANDA-NEWS. May 11, 2010. Parex banka has concluded an agreement with the Bank of Latvia on repayment of loans amounting to 117,6 million lats prior to final maturity. This decision has been made taking into account the constantly growing deposit base of Parex banka, stability in Lat money market, as well as the Bank’s liquidity ratio, which is currently well above the regulatory level. These loans were issued in the last months of 2008, and they have been repaid on Wednesday, 5 May 2010, reported the press-centre of Parex Banka.
Nils Melngailis, Chairman of Parex banka’s Management Board, stated: „The Bank has achieved better results as expected in attracting deposits in the first quarter 2010. We have received large-scale term deposits both from residents and non-residents, thus the total deposit portfolio has increased in all business segments. Likewise, we have witnessed a certain increase in the customer activity, including, more client transactions, active usage of payment cards and increase of other business activity. This enables the bank to fully cover one of the largest liabilities towards one of the largest lenders – Bank of Latvia.”
The repayment of the loan will enable Parex banka to decrease the monthly interest payments, as well as ensure more effective management of the Bank’s securities. Moreover, the Bank’s deposit base has increased by more than 100 million lats in the first quarter 2010, excluding the deposits made by the State Treasury. The steepest increase was observable in the corporate sector, where the deposit amount has hiked by 58%.
Meanwhile the Bank has paid more than 51 million in interest on the deposits to the State Treasury since December 2008. Expecting a further improvement of the Bank’s liquidity ratio, Parex banka is looking forward to consider the opportunity of repaying State Treasury deposits in nearest future.
In February 2010, Parex banka has made the second payment to its syndicated lenders, transferring the sum of EUR 310 million in accordance with its contractual obligations. As the situation at the bank has become more stable and liquidity has improved, the bank was able to cover most of the sum – EUR 165 million. In accordance with the agreement on changes in the repayment terms reached with the providers of the syndicated loan in March 2009, currently the Bank has repaid 70% of the total loan, while the remaining 30% will have to be paid in May 2011.
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