FCMC permits ABLV Bank AS to implement voluntary liquidation plan under control of FCMC
The Board of the Financial and Capital Market Commission (FCMC) at the extraordinary meeting today, 12 June 2018, took a decision to permit ABLV Bank AS (hereinafter – the Bank) to launch the announced voluntary liquidation process. The European Central Bank (ECB) has been notified of the FCMC decision and has examined the aspects of prudential supervision. The voluntary liquidation process will be the framework for the change of Bank’s management according to which the liquidators will further take over the role of the Bank’s senior management.
The decision regarding intention to implement the voluntary liquidation was adopted at the Bank’s shareholders meeting of 5 March 2018 and application of a draft voluntary liquidation plan, which was considered as the best solution as to the protection of the interests of Bank’s customers and creditors, was submitted to the FCMC. The FCMC examined the draft voluntary liquidation plan and all the additional documents submitted by the Bank, including those that reflect the actual financial soundness of the Bank, and carried out the analysis of the Bank’s ability to completely meet the obligations to its creditors within a specified time limit. Several supervisory authorities were involved in the above assessment, as well as an independent auditing company that conducted the assessment of Bank’s assets and self-imposed liquidation assumptions. In view of all above mentioned the FCMC has come to the conclusion that the Bank has sufficient amount of assets to meet the interests of all creditors and permits to start the voluntary liquidation process where the FCMC will continue monitoring and ensuring the control mechanisms necessary for the prevention of money laundering.
Chairman of FCMC, Pēters Putniņš: “FCMC Board’s decision, which is truly aimed at protecting the interests of creditors in the course of winding-up the Bank, is the logical outcome through hard and patient work of the FCMC experts for more than three months that leaves no room for false assumptions. This is an unprecedented solution to the winding-up of the bank in Latvia. We believe that in this case, of all forms of liquidation, the controlled self-imposed liquidation will ensure the further involvement of the FCMC and, if necessary, also the possibility to exert its influence on the ongoing voluntary liquidation process, including the protection of Bank’s assets and control over the payable amount in order to prevent any money laundering during the process. Therefore we have also weighed also the most suitable ways of involving a permanent team of authorised persons at the Bank in particular in this process. Today’s decision demonstrates that the financial standing of the Bank is appropriate for this solution, thus the current supervisory framework in Latvia has justified itself by imposing increased requirements for the banks from the segment servicing foreign clients.”
In accordance with the provisions of the Credit Institution Law voluntary liquidation of a credit institution shall be performed by one or more liquidators. In examining the draft voluntary liquidation plan the FCMC also carried out the assessment of the potential liquidators proposed by the Bank pursuant to the uniform regulatory provisions for the bank management. The FCMC has obtained reasonable assurance that all the proposed candidates for liquidators will be able to ensure objective and independent decision-making; moreover, no existing or potential conflicts of interest have been identified that could be an impediment to the appointment of liquidators. The liquidators responsible for the Bank’s liquidation procedure will be Arvīds Kostomārovs, Andris Kovaļčuks, Elvijs Vēbers and Eva Berlaus.
In the coming days, the FCMC will prepare a draft decision on the withdrawal of authorisation of the Bank and submit it to the ECB. The liquidator of a credit institution shall, not later than within three days after the withdrawal of authorisation, publish the notification of voluntary liquidation in the official gazette Latvijas Vēstnesi, and that will indicate the beginning of the three-month period for submission of creditor claims.
The FCMC will continue to monitor the activities of liquidators pursuant to the provisions of the Credit Institution Law until completion of voluntary liquidation process in order to ensure the lawful process and protection of creditors interests in line with control mechanisms for the prevention of money laundering, which are set up for this particular case, including assessing regular performance reports by liquidators, following the process in line with the approved plan, as well as examining complaints regarding the liquidators’ actions.
For further information:
Head of the FCMC’s Communications Division
Phone: +371 67774807