Bank of Lithuania Reviewed Results of Inspection of AB Ukio Bankas
OREANDA-NEWS. January 11, 2009. 1. On the results of inspection and supervisory review and assessment of AB Ukio bankas
The Board of the Bank of Lithuania was presented information on the results of inspection of AB Ukio bankas. The inspection focused on the management, internal control, management of individual risks (credit, liquidity, market and operational) at the Bank, as well as on certain issues of the Bank’s internal capital adequacy assessment process (ICAAP), reported the press-centre of Bank of Lithuania.
A supervisory review and assessment of Ukio bankas was conducted for the first time. Its results were presented to the Board of the Bank of Lithuania.
The Board adopted decisions implementing which Ukio bankas is to strengthen its capital base and to limit the growth of certain risk-bearing assets.
Ukio bankas was instructed to remove the violations of legal acts and deficiencies in its operation indicated in the inspection report by 1 June 2009.
The Head of Administration and the Chairman of the Board of Ukio bankas were obligated to visit the Bank of Lithuania and to explain, how the Bank intends to remove the violations of legal acts and the deficiencies in operation identified during the inspection and, at the end of the established term for the removal of the deficiencies and violations, to visit the Bank of Lithuania and to inform, how it has been done.
2. On the results of inspection and supervisory review and assessment of AB PAREX BANKAS
The Board of the Bank of Lithuania was presented information on the results of inspection of AB PAREX BANKAS. The inspection focused on the credit risk management and profitability risk at the Bank, as well as on certain issues of the Bank’s internal capital adequacy assessment process (ICAAP).
A supervisory review and assessment of this bank was conducted for the first time. Its results were presented to the Board of the Bank of Lithuania.
On 8 November 2008, the Latvian government decided to acquire 51 per cent of the shares of Latvia?s AS Parekss Banka, holding a subsidiary in Lithuania, later - to increase the holding. Since 5 December 2008, 84,83 per cent of the Latvian AS Parekss Banka capital belong to the Latvian state company “Latvijas Hipoteku un zemes banka".
At the Board’s meeting it was noted that recently there was a decrease in deposits with PAREX BANKAS, however additional financing has been provided to it by the Latvian parent bank, AS Parekss Banka.
PAREX BANKAS was instructed to remove the deficiencies in its operation indicated in the report on the inspection conducted by the Bank of Lithuania by 1 June 2009.
3. On permission to register amendments to the Articles of Association of PAREX BANKAS
The Board of the Bank of Lithuania permitted AB PAREX BANKAS to register an amendment to its Articles of Association related to the increase of its authorised capital to LTL 188,149,000, as well as an amendment to its Articles of Association related to the change of the competence of the Bank Board, approved by decision of the Bank’s sole shareholder on 1 December 2008.
Meanwhile PAREX BANKAS has registered an authorised capital of LTL 180,000,000, which has been divided into 1, 8000,000 ordinary registered shares. The nominal value of one share is LTL 100.
By the 1 December 2008 decision of the PAREX BANKAS’ sole shareholder, the share capital is increased by LTL 8,149 million through the issuance of 81,490 ordinary registered shares with the value of LTL 100 each, paying LTL 8,149 million to the key shareholder by the claim rights arising from the subordinated loan of 11 December 2006, changing the subordinated loan into PAREX BANKAS’ shares of the new issue.