June 10, 2009

Latvia police in Swedish banks probe

(AFX UK Focus) 2009-05-08 16:24

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RIGA, May 8 (Reuters) - Swedish-owned banks in Latvia have used "hostile" methods to reclaim debts from borrowers and are under police investigation, Latvian Prime Minister Valdis Dombrovskis was quoted as saying on Friday.
"We are investigating certain methods like freezing companies' accounts and taking over collateral, even in a fairly hostile way," Swedish news agency TT quoted Dombrovskis as saying in an interview.
Dombrovskis was quoted as adding that the methods employed by the banks hampered businesses from paying taxes since all their funds were channelled towards repaying debts.
He declined to name which banks were being probed.
TT said there was a special department in the police that was investigating the banks.
Swedish-owned banks operating in the country said they had no information about such probes. The FKTK banking supervisor said it had received complaints from clients, but had no evidence of unfair business methods.
The FKTK bank watchdog said it had no evidence any unfair business methods have been used.
"We have received complaints from borrowers but there is no evidence that there is anything wrong between banks and borrowers," Janis Placis, a spokesman for the commission said.
Swedbank, SEB and Nordea said they have not been notified by police about any investigation.
"We have not received any information that our bank is under investigation or any documents from police saying that we could be considered for any form of investigation," said Agnese Gribuste, SEB Latvia spokeswoman.
Dagnija Stukena, spokeswoman for Nordea in Latvia, said they have not been contacted by police and were unaware of any investigation regarding wrongdoings against their debtors.
"All we can say is that we follow the law under the agreements we have with our clients," she said.
"We are quite surprised at this because we have no information about this investigation," said Swedbank spokesman Ivars Svilans.

(Reporting by Jorgen Johansson; editing by Simon Jessop) Keywords: LATVIA BANKS/ (Riga newsroom, patrick.lannin@reuters.com, patrick.lannin.reuters.com@reuters.net, +371 29 269 191)


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