On provision of information regarding foreign financial investments into subordinated capital of Latvian credit institutions

13.11.2010
  • Section:

Riga, 13.11.2010

Press Release

On provision of information regarding foreign financial investments into subordinated capital of Latvian credit institutions

The Board of Financial and Capital Market Commission today approved amendments to the Regulations for Calculating the Minimum Capital Requirements specifying requirements for revaluation reserves in calculation of own funds resulting from revaluation of fixed assets and inclusion of gains recognised as a result of revaluation of investment property in Tier II capital, in order to ensure unambiguous understanding and interpretation of set requirements, as well as prescribe that the institution submits to the Commission a copy of contract electronically not later than next business day after the inclusion of the borrowing in the Tier II capital in case the borrowed assets are included in the institution’s Tier II capital as a subordinated capital.

Such a requirement is set pursuant to the amendments to the Immigration Law of 1 July of this year, according to which foreigners are eligible to apply for a term residence permit for the period not exceeding five years, if they have made financial investments in a credit institution of the Republic of Latvia in the amount of not less than 200 000 lats (as subordinated debt or subordinated bonds), provided that the transaction term is not less than five years and under the terms of deposit it cannot be terminated before the repayment term.

Above amendments to the Immigration Law back financial investments in the subordinated capital of Latvian credit institutions, however, the money laundering issue could become pressing thereby. Since the Commission’s long-term objective is to lessen the impact of the US State Department annual money laundering and financial crime report on the Latvian financial system and state reputation, the requirement to submit the copy of loan agreement electronically to the Commission now will be included in the Regulations for Calculating the Minimum Capital Requirements.

Anna Dravniece

Head of Office

Financial and Capital Market Commission

Prepared by:

Ieva Upleja

Chief Public Relations Specialist

Financial and Capital Market Commission’s Office

phone: (+371) 6777 4807; e-mail: ieva.upleja@fktk.lv

Contacts


Address:
Kungu iela 1, Riga, LV-1050
Phone:
6 7774800
E-mail:
To report on unauthorised firms
Data protection

Follow the news