Aizkraukles Banka Involves an Auditing Company for the Acquisition of Another Bank

September 16, 2002 / Banking

With a view to considering the prospects of acquisition of another bank, Aizkraukles Banka (AB) had, this week, requested the auditing company Ernst&Young to evaluate the proposals meeting certain requirements. It is an internationally accepted practice to involve a consultant for the purposes of such an important deal. Ernst&Young is among the largest auditing companies in the world.

The further development strategy approved by the shareholders of AB this year provides for a substantial increase in its market share during the years to come. “Along with the introduction of new services and marketing activities, we shall also consider the prospects of acquiring another bank operating in Latvia,” – Mr. Olegs Fils, Deputy Chairman of the Board of the Bank, explains.

The shareholders of AB are considering the likelihood of acquisition of some of the competing financial institutions. This would enhance the development of the customer base, amount of credits and deposits.

“The main criterion for us to consider buying a particular bank is the unity of the bank’s business with the strategy of Aizkraukles Banka that would allow for increasing the market share in those market sectors, which we find being the most attractive for us, as well as for successful integration of the acquired bank,” – Mr. O. Fils notes, emphasizing that: quote “it is a continuous process and cannot be achieved within a few months time. No further details concerning this process could, however, be given by AB at this stage. To the extent possible, we shall keep the public informed about our plans and the developments in this respect.” unquote

In terms of the shareholders equity, AB is among seven major banks in Latvia. Its shareholders equity had, as of the end of August this year, reached 15.69 million Lats. “This growth forms a good platform for further development” – considers Mr. O. Fils, one of the major shareholders of the Bank, also noting that at the same time AB had been strictly following to ensure a sustainable development.

The paid-up capital of AB equals 10 million Lats, number of shares – 100 thousand. There are 155 shareholders in AB, including 122 individuals and 33 companies. The major shareholders for the time being are Mr. Olegs Fils — 45.83% stock, Mr. Ernests Bernis — 44.8% stock, and Mr. Aleksandrs Bergmanis – 3.87% stock.

by Olegs Fils,
Vice-chairman of the Board of AS Aizkraukles Banka