26,081 of Latvian banks' clients are shell companies

Take note – story published 6 years and 2 months ago

There are 26,081 shell companies among clients of Latvian banks, including two companies of Latvian origin, Ieva Upleja, a spokeswoman for the Financial and Capital Market Commission (FCMC), told LETA March 14.

The banking regulator’s spokeswoman informed that shell companies account for 36.57% of the Latvian banks’ incoming payment turnover, while their share in the non-resident segment is 44.5%.

“The share of these companies can be estimated in terms of loan turnover, income and assets. We estimate it by loan turnover,” Upleja said, explaining that this data shows a higher share and a more credible risk level.

Upleja said that this data reflects the share of transactions business, but that it does not show the percentage of deposits.

Interestingly, FKTK has never previously given out a comparable estimate of the number of bank accounts were held by shell companies.

Latvia's banks have around 2.6 million clients in total.

The data also includes the loan turnover of ABLV Bank whose shareholders have decided to liquidate the bank.

To learn more about the Latvian 'non-resident' banking sector, see a recent feature on LSM that looks at who and what are these boutique banks specializing in serving foreign clients. 

NOTE: An original version of this story referred to "aggregate loan turnover". This has been corrected to "incoming payment turnover" on advice of the regulator. We are happy to provide the correction. 

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