Banks

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Licensing of banks

The bank is a capital company, which accepts deposits and other repayable funds from an unlimited circle of clients, issues credits in its own name and provides other financial services. Persons, which are authorized to found a credit institution, are specified in Section 16 of the Credit Institution Law.

In order to receive a credit institution operating licence (permit), a bank shall submit to the Financial and Capital Market Commission (the Commission) the information and documentation in accordance with provisions of the Credit Institution Law and Regulations on the Issue of Credit Institution and Credit Union Operating Licences of 24.05.2002 approved by the Board of the Commission.

The minimum initial capital of a bank shall be equal to five million euros, which have been converted to lats in accordance with the exchange rate set by the Bank of Latvia on the day when the decision to issue a licence (permit) for the operation of the bank has been taken.

The Financial and Capital Market Commission shall examine the application for obtaining licence (permit) within a three-month period after the receipt of all the necessary documents. The decision to issue a licence of credit institution operations is adopted by the European Central Bank based on the draft proposal by Financial and Capital Market Commision.

The Commission shall issue the licence within a three-day period after the receipt of a copy of the certified registration certificate of the bank.

The Credit Institution Law and other relevant regulatory rules for banks are available on the Commission’s website at http://www.fktk.lv/en/law/credit_institutions/laws/