The FINANCIAL -- The European Bank for Reconstruction and Development (EBRD) welcomes the closing of the agreement to privatise Latvia’s Citadele bank.
As of April 20 Citadele is majority-owned by a group of international investors led by the US investment firm Ripplewood Holdings and Tim Collins, founder and CEO of Ripplewood. The EBRD, which became a shareholder in the predecessor of Citadele in 2009, has agreed to retain a 25 per cent stake alongside the Ripplewood-led investors, according to EBRD.
Phil Bennett, EBRD First Vice President, said: “The privatisation of Citadele is a very visible milestone in the recovery of Latvia. It sends a strong signal to investors, demonstrating the comeback of the country as one of the fastest-growing economies in Europe. Citadele is a solid financial institution with a sound business model and high standards of corporate governance. The EBRD has agreed to remain a shareholder, working to continue this successful development. Strong banks, such as Citadele, are a vital part of a robust economy because only they can provide the funds needed to grow businesses, especially in the small and medium-sized enterprise sector where Citadele excels.”
Guntis Beļavskis, CEO of Citadele, added: "The European Bank for Reconstruction and Development has made a contribution of exceptional significance in the growth of Citadele banka. We are happy that the EBRD will also continue to be one of our shareholders in the future."
Following a comprehensive and multi-tiered bidding process, in accordance with international standards and EU requirements, the government of Latvia decided in September 2014 to sell a majority stake in Citadele to a group of investors led by Ripplewood. A purchase agreement was subsequently signed between the Latvian Privatisation Agency and the buyer. The final agreement has now come into force with today’s closing.
The EBRD joined the efforts of the international community to mitigate the severe impact of the global financial crisis on Latvia, becoming a shareholder in Parex bank – then the country’s second-largest lender – in September 2009. After a successful restructuring the institution was split in August 2010 into Citadele, which was prepared for privatisation, and Reverta, which is managing the troubled assets.