The European Central Bank (ECB) has declared that the Latvian bank ABLV, the second largest bank of the country, can no longer be saved. After ECB blocked all payments at the bank, the ECB decided that it is not in the public interest to further rescue the ABLV, the debts are too large to rescue the bank.
North Korean missile program
Liquidity problems of ABLV are the result of sanctions that were recently imposed by the US Treasury Department. The USA believes the bank has done business with parties that support the North Korean missile program and that the bank has laundered money.
Savings are guaranteed
The central bank of Latvia claimed that ABLV had sufficient buffer capital to save it, but according to the ECB, that is not the case. Savings of up to € 100,000 are guaranteed via the deposit guarantee scheme. Latvian Prime Minister Kuinskis will convene an emergency meeting about the risks at other Latvian banks.
