FCMC forbids Versobank AS to provide financial services in Latvia

07.09.2016
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Riga, 07.09.2016

Press Release 

FCMC forbids Versobank AS to provide financial services in Latvia

The Board of the Financial and Capital Market Commission (FCMC) has decided to prohibit Versobank AS from providing financial services in Latvia: attracting new customers in the territory of Latvia as well as the bank is requested to terminate contractual relationship with current customers.

The decision on imposing a ban on provision of any financial services in Latvia is adopted because Versobank AS has been substantially violated procedures laid down in the Credit Institution Law under which a credit institution registered in another Member State may launch cross-border activities through opening a branch in Latvia. Versobank AS has continuously provided financial services through a permanent physical presence in Latvia that can be verified by numerous facts.

In accordance with the Credit Institution Law if the FCMC determines that a credit institution registered in another Member State, which provides financial services without opening a branch, performs activities that are in contradiction to the laws of Latvia, it shall without delay request that the credit institution terminate such activities. If a credit institution does not terminate the activities that are in contradiction to the laws of Latvia, the FCMC shall inform the relevant Member State supervisor, the duty of which is to act so that the violations are rectified. 

The FCMC Board has decided to prohibit Versobank AS from providing any financial services in Latvia, to ensure the development and stability of the financial and capital markets as well as to enhance the protection of the interests of investors and depositors that use financial services. The FCMC is of the opinion that the activities of Versobank AS pose a threat to the credit institution sector, reputation and interests of customers.  

Up to now, Versobank AS was eligible to provide financial services in Latvia only without a physical presence under the freedom to provide services. Versobank AS is a credit institution authorised in Estonia, whose activities are subject to supervision of the Estonian Financial Supervision Authority.

Further information:

Agnese Līcīte

Public Relations Specialist

FCMC Communications Division 

Phone: +371 67774808; e-mail: Agnese.Licite@fktk.lv

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