|
Dear clients and cooperation partners,
We summarise below the latest information about Latvijas Krājbanka, covering the insolvency proceedings and sale of the bank's assets. This newsflash covers preparing a written creditors' application, as well as listing the bank's most valuable assets. Should you have any questions, please contact the SORAINEN Latvia Banking Practice lawyers.
Krājbanka creditors should apply by 11 August 2012
On 8 May 2012, a decision of Riga Regional Court initiated bankruptcy proceedings of the insolvent Latvijas Krājbanka. The proceedings include sale of the bank's property and extinguishment of creditors' claims, overall resulting in liquidation of the company. The bank's operations were suspended in November 2011.
According to a decision of the Riga Regional Court, the bank's creditors should bring claims and petitions against the bank by 11 August (inclusive) at the latest. Claims and petitions must be filed even if the same persons filed claims and petitions before the bankruptcy proceedings were initiated.
Claims and petitions should be sent by written application to the certified administrator authorised by KPMG Baltics, Jānis Ozoliņš, certificate No. 00238 (correspondence address for the administrator and its authorised person: J. Daliņa iela 15, Riga, LV-1013, ph +371 67 104 050, e-mail: kpmg@lkb.lv). The form of application prepared in English by the administrator is available here.
After costs of insolvency proceedings are covered, remaining funds will be distributed for satisfaction of principal amounts of creditors' claims in the order set by the Credit Institution Law.
Use the opportunity to participate at asset sales
In the meanwhile, a gradual sale of the bank's assets is under way. In total the procedure of asset sales might take 12-18 months. Each auction will be notified separately by the administrator with a published announcement indicating sales conditions.
The largest asset is the credit portfolio of LVL 231 million (approx EUR 329 million) which will most likely be sold at auction this autumn, divided into several smaller portfolios. Work is under way to prepare for sale of the loan portfolio involving approx 17,000 separate borrowers. The mass media have suggested that division could be undertaken in a manner to adjust the credit portfolio to investors' interests. Contracts and credits can be grouped according to both the return status and their borrowers.
According to publicly available information, approx 56% of the bank's borrowers – corresponding to 38% of the total credit portfolio – are performing their debt liabilities on schedule; however, 28% of borrowers – or 20.5% of the total loan balance expressed in money terms – are more than 180 days in arrears of payments. At present, the bank's investments in real estate correspond to approx LVL 25 million (approx EUR 35 million), and investments in affiliated companies correspond to approx LVL 15 million (approx EUR 21 million).
Assets that could attract considerable interest from buyers include eg the main office building at J. Daliņa iela 15, Riga and an ATM network of 213 cash machines. The bank must also sell 21 branches; 14 of these are located in Riga and Riga region, with seven located elsewhere in Latvia. In the near future, the bank's cars and special-equipment cash collection vehicles will be sold at auction.
If you have questions about these procedures, please contact the head of the SORAINEN Latvia Banking Practice, partner Rūdolfs Eņģelis, or senior associate Ansis Spridzāns, who will provide the necessary legal assistance and support.
*The document uses public information.
|
