Court Resolves to Secure Parex Banka's Claim Against V.

ANNOUNCEMENT TO THE PRESS
2010. 16 August 2010  


Court Resolves to Secure Parex Banka's Claim Against V. Kargins and V.
Krasovickis 

Today, on 16 August 2010, Riga District Court resolved to secure the claim
brought forward by joint stock company Parex banka against its former owners
and Members of the Board - Valērijs Kargins and Viktors Krasovickis - for
compensation of losses by mortgaging real estate, movable property and cash
funds possessed by V. Kargins and V. Krasovickis as well as payments due to
them by third parties. This also refers to their monetary funds deposited in
credit institutions and other finance authorities, including Parex banka. This
means that V. Kargins and V. Krasovickis will discontinue receiving the notable
interest payments for their deposits in Parex banka. 

Simultaneously the Court has resolved to secure Parex banka with compensation
of losses which might arise from execution of this decision by depositing a
certain amount of money in the account of the office of the Court. 

It has already been announced that on 30 July 2010 Parex banka filed a claim
against its former Members of the Board - Valērijs Kargins and Viktors
Krasovickis - requesting them to compensate losses caused to the bank. The
total sum of the claim is 62 million Lats. 

Considering the loan and deposit agreements concluded between the bank and both
of the former shareholders, who also were the bank's majority shareholders at
the same time, as well as persons related with them during the period from 1
January 1995 until 5 December 2008, the bank has found a succession of
transactions which do not comply with its interests. These transactions were
executed applying terms and conditions which significantly differ from the
terms and conditions that unrelated parties would conclude such deals. Analysis
shows that these transactions have enabled the former Members of the Board to
acquire wealth at the bank's expense for more than 62 million Lats during the
mentioned period. 

A substantial fact is that according to the available information, V. Kargins
un V. Krasovickis concluded the mentioned agreements while being in a conflict
of interest and by breaching several laws. Therefore serious violations have
been found in the activity of both former Members of the Board regarding the
responsibilities of members of the board provided in the law, thus causing
losses to the bank. 


About Parex banka:

Parex banka is structured as a resolution bank whose main task is to maximize
recovery of the investments made by the State. In order to achieve its goals,
activity of Parex banka is focused on effective restructuring of loans and
securing of overtaken loans the majority of which are real estate.  Along with
planning purposeful increasing of the value of assets, Parex banka also
performs professional real estate management and as the situation becomes
stable in real estate segments, it will sell them at the best price possible
for the benefit of all shareholders. 

Additional information: 
Marita Ozoliņa-Tumanovska
Head of Communications and Marketing 
Tel. 67779142 or 29287169
e-mail: Marita.Ozolina-Tumanovska@parex.lv
Court Resolves to Secure Parex Banka's Claim Against V. Kargins and V. Krasovickis
