| Latvian president promulgates bank takeover bill |
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| Tuesday,December 30,2008 Posted: 15:18 BJT(0718 GMT) |
| From:Baltic News Service Article type:Original |
RIGA, Dec 30, BNS - Latvian President Valdis Zatlers has signed a new bill on bank takeovers into law, a statement published in Latvijas Vestnesis official newspaper says.
The new law takes effect the next day after its promulgation, i.e., on Dec. 31.
Rafails Deifts, a minority shareholder in Latvia's ailing Parex Bank, currently taken over by the government, sent Zatlers a letter calling to suspend the promulgation of the bank takeover bill. In his letter, the Parex shareholder indicated that the bill contravened the Latvian Constitution and international property rights.
The Latvian parliament on Dec. 18 passed the bill about takeover of banks aimed at preserving stability of the Latvian banking system.
Under this bill, the Latvian financial watchdog, the Finance and Capital Market Commission (FKTK), or the Bank of Latvia can propose a takeover in exceptional cases in presence of a serious threat to the Latvian banking system stability or smooth functioning of the payment systems. In accordance with the bill, bank takeovers can be either voluntary or compulsory in case of an emergency situation.
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