OREANDA-NEWS. March 29, 2011. Management and experts from the Parex Bank, like professional handlers of toxic assets anywhere in the world, have regularly been analysing the offers of potential investors, meeting with serious market players from Great Britain, Russia, Switzerland, the United Arab Emirates, and other countries.  Over the past six months, more than 100 institutional investors have demonstrated an interest in buying certain loans from the Parex Bank, but the market situation at this time is one in which the prices that have been offered are far behind the potential market value of the relevant assets, and so the offers are not in line with the bank’s interests, reported the press-centre of Parex Bank.

“International experience shows us that any manager of toxic assets first tries to restructure the assets in his lending portfolio, and only if that proves to be impossible are other things done,” says Parex Bank board chairman Christopher Gwilliam.  “There are two opportunities – collect the debts and take over the assets, or offer the assets to investors.  Parex Bank is a solutions bank and has been working only for eight months.  That is a comparatively short period of time, and we are not yet at the phase of development which will allow us to offer assets to investors en masse,” he added.

Gwilliam continues:  “There is a lot of interest in the world about so-called toxic loans at this time, but most investors want to find assets that are easy to sell – ones which will become more valuable in future and allow investors to increase the sum of investment.  I must emphasise the fact that management at the Parex Bank are doing everything possible to increase the value of our assets.  We are taking over and managing assets so that a few years from now, when the economic situation improves in Latvia, we can sell them at maximum advantage.  The Parex Bank has experience that is unique only at Latvia’s level.  Elsewhere in the world, the model of a solutions bank is nothing new or unusual.  I have been in the international financial sector for nearly 20 years, and I have worked with such banks in the past.”

On August 1, 2010, the Parex Bank became a solutions bank and halted traditional banking services such as account and deposit services, lending, etc.  The primary purpose of the Parex Bank is to recover the state’s investment as much as possible.  In pursuit of this goal, the bank has concentrated its operations on effective restructuring of loans, debt collection, as well as management of real estate that has been taken over.