Navigation path

Left navigation

Additional tools

Other available languages: FR DE LV

European Commission

Press release

Brussels, 16 April 2014

State aid: Commission opens in-depth investigation into public support measures in favour of Latvian Reverta (formerly Parex) and Citadele banka

The European Commission has opened an in-depth investigation to assess whether the additional state support measures granted by Latvia to AS Parex banka (rebranded "Reverta") and AS Citadele banka in the context of their restructuring were in line with EU state aid rules. The Commission also has doubts that the implementation of the approved restructuring plan respects the commitments given by Latvia, aimed at restoring the banks' viability and at limiting distortions of competition. The opening of an in-depth investigation gives interested third parties an opportunity to submit comments. It does not prejudge the outcome of the investigation.

During the financial crisis, the Commission approved a rescue and restructuring package in favour of what was then Parex banka in a number of decisions (see IP/08/1766, IP/09/732 and IP/10/1127). The restructuring plan approved by the Commission in September 2010 provided for a split of the Parex banka into a good bank (named Citadele banka) and a bad bank, Parex, later renamed Reverta. The restructuring plan was further amended in August 2012 with the Commission's approval.

In 2013, the Commission identified additional aid measures that Latvia had granted to Parex and Citadele, which had not previously been notified to the Commission - in breach of Member States’ obligation to do so under EU state aid rules - or went beyond what had been approved by the Commission. In particular, these include:

  • a subordinated loan to Parex with a maturity of 7 years, longer than the approved maximum length of 5 years;

  • an additional 18-month extension of the maturity of one of those subordinated loans; and

  • liquidity support granted to Parex, beyond the maximum limit approved by the Commission.

Moreover Latvia has failed to comply with its commitment to divest the Wealth Management Business of Citadele.

Based on the information provided by Latvia at this stage, the Commission has doubts whether the additional measures are in line with the rules on state aid to banks during the crisis. In particular, the Commission has concerns that the additional measures were not limited to the minimum necessary. The Commission has therefore opened an in-depth investigation to assess whether these additional measures can be found compatible with EU state aid rules, and whether Parex's restructuring plan has been implemented correctly.


At the end of 2008, AS Parex banka was the second largest bank in Latvia with total assets of LVL 3.4 billion (EUR 4.9 billion). It had been very active in the Commonwealth of Independent States ("CIS"), which was severely hit by the financial crisis. This resulted in a loss of confidence in Parex and a subsequent run on the bank in 2008, with a 36% fall in deposits compared to end 2007. Latvia regarded the bank as being of systemic importance for the financial system and as a result injected substantial state aid.

In November 2008 Latvia notified a package of rescue measures in favour of AS Parex banka, which the Commission approved in November 2008 based on Latvia's commitment to submit a restructuring plan within six months (see IP/08/1766). After carrying out a formal investigation procedure (see IP/09/1203) the Commission approved Parex's restructuring plan in September 2010 (see IP/10/1127). The plan included a split of Parex into a newly established bank named AS Citadele banka, a "good bank", taking over all core assets and some non-core assets, and a "bad bank" ("Parex", later renamed "Reverta"), which kept the remaining non-core and non-performing assets. In August 2012 the Commission approved amendments to three commitments included in the restructuring plan.

The non-confidential versions of these decisions will be made available under the case number SA.36612 in the State Aid Register on the competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

Contacts :

Antoine Colombani (+32 2 297 45 13, Twitter: @ECspokesAntoine )

Yizhou Ren (+32 2 299 48 89)

For the public: Europe Direct by phone 00 800 6 7 8 9 10 11 or by e­mail

Side Bar