OREANDA-NEWS. August 04, 2010. Bank Citadele, Privatisation Agency and the European Bank for Reconstruction and Development signed an agreement on 30 July 2010, whereby the EBRD enters bank’s Citadele shareholding structure with 25 % of share capital plus 1 voting share. Cabinet of Ministers of Republic of Latvia approved the agreements on sale of shares owned by Privatisation Agency in bank Citadele to the EBRD for the price equivalent to the share nominal value, reported the press-centre of EBRD.

Meanwhile, the EBRD and Parex banka signed a Novation Agreement and Amended and Restated Subordinated Loan Agreement, stating that the subordinated loan issued by the EBRD to Parex banka will be transferred to bank Citadele, the total amount of the subordinated loan will be 22 million EUR. The first part of the loan has already been issued, while the other part in amount of 3.6 million euros will be provided in one instalment, being the subject of receiving the final EC approval.

The EBRD’s investments will bring with it support and expertise to further develop the bank’s business, contribute to best practice corporate governance and assist in the bank’s return to private sector.

Juris Jakobsons, Chairman of bank Citadele: “The EBRD’s entrance in bank’s Citadele shareholding structure shows their confidence in the new bank and approved the decisions made by Latvian Government in regards to the restructuring of Parex banka and transfer of enterprise to bank Citadele. Moreover, the signing of agreement on the EBRD’s entrance puts significant cornerstone in the Bank’s further development and achievement of the set goals in the business plans.”

Peter Reiniger, Managing Director at EBRD said: “The creation of Citadele was a milestone, which was the result of a great deal of hard work by many people and an example of good cooperation between EBRD and the Latvian Government. Citadele will be able to contribute to Latvia’s economic recovery by lending to SMEs and EBRD looks forward to its continued support of the bank.”

Bank Citadele was established by Privatisation Agency on 30 June 2010 with the share capital of 4 million lats. On 29 July 2010 the Bank’s share capital has been increased by 99 million lats to 103 million lats.