Warning issued to AS “Meridian Trade Bank” for breaches of large exposure limits

20.06.2019
  • Section:
The Board of the Financial and Capital Market Commission on 18.06.2019 imposed a penalty on AS "Meridian Trade Bank" (hereinafter – the Bank) – a warning for a failure to comply with large exposure limits, i.e. 25% of Bank's eligible capital; consequently, the requirement of Article 1 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 had not been met.

Article 395 of Regulation No 575/2013 lays down limits to large exposures for credit institutions: an institution shall not incur an exposure, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, to a client or group of connected clients the value of which exceeds 25 % of its eligible capital. Where that client is an institution or where a group of connected clients includes one or more institutions, that value shall not exceed 25 % of the institution’s eligible capital or EUR 150 million, whichever the higher, provided that the sum of exposure values, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, to all connected clients that are not institutions does not exceed 25 % of the institution’s eligible capital.

FCMC will ensure monitoring measures to establish whether the Bank implements the planned measures for addressing the infringement and prevents further infringements of the Regulation No 575/2013 regarding large exposure limits.

Further information:
FCMC Communications Division
Phone: +371 67774807; +371 67774808
Email: ieva.upleja@fktk.lv, dace.jansone@fktk.lv

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