OREANDA-NEWS. October 26, 2010. One of the leading and the most efficient Latvian banks Rietumu generated 44% of the local banking sector. Rietumu remains the profit leader for the second crisis year in a row. As of the first half of 2010, Rietumu earned EUR 3 million. Notwithstanding the current profit volume, the bank is certain to post much more substantial profit results next year, reported the press-centre of Rietumu Bank.

The Latvian banking sector as such continues to suffer losses – most of the banks are showing negative dynamics since 2008. The aggregate losses accounted for EUR 360 million in the first half of 2010, slightly less than last year for the corresponding period, when the losses reached almost half of a billion.

EUR 88 million of the current losses are attributed to Parex bank that was nationalised by the Government two years ago. Other losses are divided prevailingly among subsidiaries of Scandinavian and German banks that implemented aggressive credit policies before the crisis aiming to gain the larger market share. For example, Swedbank, the largest local bank by assets based in Scandinavia, posted EUR 82 million losses as of the first half of 2010.

On the whole, only 7 out of 27 Latvian banks posted profits for the half-year of 2010. In the corresponding period of 2009, there were 10 profitable banks. No longer profitable are: Trasta komercbanka (EUR 3.8 losses), PrivatBank (EUR 5 million losses) and Pasta banka (EUR 0.09 million losses).

At present, those banks, which possess free resources, aim to use them efficiently using new opportunities that arise during the crisis. Rietumu, for instance, focuses on export of financial services to the CIS countries – the area, where Latvian banks can potentially earn nowadays. The new Latvian Immigration Law, which allows foreign investors to obtain a residence permit and travel within the Schengen Area freely, facilitates the Eastern expansion. Rietumu remains the most active seller and promoter of the new law since July 2010 – the bank implements a support programme for its customers providing multi-level assistance in obtaining a European residence permit.