According to European Comission guidelines dated October 25, 2008 Latvia has started implementation of stabilization plan of financial sector. Within this plan the Cabinet of Ministers of the Republic of Latvia on November 8, 2008 voted on decision, paragraph 27, minutes 70 that Joint Stock Company “Latvijas Hipotēku un zemes banka” (100% owned by Government of Latvia) will sign agreement to acquire 51% share capital of “Parex banka” for total price of 2 Ls (two lats). The agreement was signed on November 10, 2008. Due to short term nature of investment the Financial and Capital Market Commission of Latvia has accepted non-consolidation approach. “Latvijas Hipotēku un zemes banka” in this deal is acting as a holder of the stake in “Parex banka” on behalf of Government of Latvia and will not assume any of liabilities of “Parex banka”. Both banks will have independent management, separate supervision, budgeting and risk management. Liability of “Latvijas Hipotēku un zemes banka” in this deal is limited to it's investment value - 2 (two lats) Ls.
JSC “Latvijas Hipotēku un zemes banka” on November 10, 2008 signed agreement to acquire 51% share capital of “Parex banka”
| Source: Latvijas Hipoteku un zemes banka