• Sweden edition
 
Swedbank hit by 'Twitter- generated' Latvia panic

Swedbank hit by 'Twitter- generated' Latvia panic

Published: 12 Dec 2011 10:06 GMT+01:00
Updated: 12 Dec 2011 17:14 GMT+01:00

A total of 126 out of 298 ATMs belonging to Swedbank, the country's biggest lender, had run dry after demand for cash soared 10-fold on Sunday afternoon, according to a statement on the Swedish-owned bank's homepage.

Queues formed at many cashpoints after rumours spread on social media networks that cash machines in Sweden and Estonia had already run out of money.

The Swedish group, a leading market player in Latvia and fellow Baltic states Estonia and Lithuania, moved swiftly to quash rumours ripping through social networks just three weeks after the failure of Latvian bank Krajbanka.

"We currently see people asking on the web and at branches about various rumours -- some of which are simply not true, and some quite absurd – that the bank is not working in Estonia, that cash machines are not working in Sweden -- which was just outright lies," Maris Marcinskis, chief executive of Swedbank's Latvia arm, said in a statement.

"We take into account that people take any speculations about the financial market and banks extremely emotionally given both the recent closure of Krajbanka and the abundance of alarming headlines about Europe and the euro zone," he said.

"Unbiased information and the bank's actual day-to-day operations is what best dispels rumours," he added.

Prime Minister Valdis Dombrovskis also moved to dispel the speculation.

"These rumours have no foundation. There is no reason to worry about Swedbank or the stability of other banks. These rumours have been spread in order to destabilize the situation in Latvia," Dombrovskis told reporters, without elaborating.

Dombrovskis also urged Latvia's banking regulator to communicate more effectively and backed police efforts to trace the source of the rumours.

But the rumours had created demand for cash 10 times greater than usual with more that 10 million lats ($19 million) withdrawn Sunday, he said.

At one Swedbank branch in Riga, a 20-strong queue was waiting at midday on Monday, but savers denied they had been influenced by rumours to come and withdraw money.

"I am confident everything is okay. This is a big Scandinavian bank that's well run and well funded. It's not Krajbanka or some Lithuanian bank," businessman Martins Smits, 42, told AFP.

The latter was a reference to Lithuania's Snoras bank, whose collapse last month amid a fraud probe fueled the demise of its Latvian subsidiary Krajbanka.

Nearby ATMs of other Nordic lenders SEB, Nordea and DNB were unaffected, though SEB said in a statement that it had noticed "increased interest" in cash withdrawals as a result of "baseless news".

Speaking on LNT, Janis Brazovskis of the country's banking regulator said rumours about Swedbank appeared to have been spread via social media and text messages.

Police are investigating the source of the scare.

Latvia is no stranger to the effects of financial rumours.

Rumours in 2008 of an imminent devaluation of its currency -- the lats, which is pegged to the euro -- caused panic but proved to be entirely false.

Swedbank is the largest bank in Latvia, holding around 20 percent of a market which has been dominated by Nordic players following the collapse of another local bank, Parex, in November 2008.

The fall of Parex came after depositors jittery about a spiralling economic crisis began pulling out cash.

A month later, the government was forced to turn to the European Union and International Monetary Fund for a $10-billion loan package, paid out in slices in exchange for one Europe's most draconian austerity drives.

Latvia's economy shrank by 18 percent in 2009, the deepest recession in the 27-nation EU, but has been recovering for over a year.

In Lithuania, Swedbank and local authorities said withdrawals had not risen.

"Swedbank is working as usual, there are no problems. I don't see any reason for panic," said Vitas Vasiliauskas, head of Lithuania's central bank.

The situation was likewise normal in Estonia, that country's central bank said.

TT/AFP/The Local (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

11:03 December 15, 2011 by JulieLou40
I didn't even know Swedbank operated in Latvia. You learn something new every day.
Today's headlines
Elections 2014
Parties duel as refugee costs skyrocket
Photos: TT

Parties duel as refugee costs skyrocket

Prime Minister Fredrik Reinfeldt and Opposition Leader Stefan Löfven clashed on Wednesday after the Migration Board asked for more money to handle Sweden's influx of refugees. READ  

Introducing: Sweden's five minority languages
The Sami in northern Sweden. Photo: Fredrik Sandberg/TT

Introducing: Sweden's five minority languages

Did you know there are five official minority languages in Sweden? The Local's Isabela Vrba finds out what they are, how they're protected, and what rights their speakers have. READ  

Swedish docs puzzled by deformed penis trend

Swedish docs puzzled by deformed penis trend

More and more Swedish boys are born with deformed penises, and researchers are uncertain exactly what's behind the increase. READ  

The Local List
What Sweden means to you in just one Tweet
Photos: Shutterstock/Imagebank Sweden

What Sweden means to you in just one Tweet

The Local Sweden has been asking readers to squeeze their view of Sweden into just 140 characters or less. Here's what you came up with up for #SwedeninaTweet. READ  

Getinge Floods
Swedish floods hit day two as rain continues
Photo: Anders Andersson/TT

Swedish floods hit day two as rain continues

UPDATED: The flood in southern Sweden showed no signs of abating on Wednesday, with forecasters predicting that the rains are unlikely to stop any time soon. READ  

Sweden and the Bronx
Swedes celebrate 375th anniversary of the Bronx
The Bronx. Photo:Shutterstock.

Swedes celebrate 375th anniversary of the Bronx

What do the Bronx and Sweden have in common? More than an affiliation with the Yankees, it turns out. And one small Swedish town is about to make that abundantly clear. READ  

Bildt: 'We must increase efforts in Iraq'
Bildt in Baghdad on Monday. Photo: Karim Kadim/TT

Bildt: 'We must increase efforts in Iraq'

After meeting with refugees and politicians in Iraq on Tuesday, Foreign Minister Carl Bildt said Sweden must increase its efforts to help Iraq reach a lasting solution. READ  

Swedes slam 'racist' art show from Denmark
One of the participants in the art project. Photo: Anna Andrea Malzer, Global Stories

Swedes slam 'racist' art show from Denmark

Swedes have gathered in numbers to protest against a Danish "blackface" art show in Malmö, which organizers say is supposed to give "a deeper understanding of discrimination". READ  

Presented by Stockholm School of Economics
Swedish school with executive appeal
Photo: Stockholm School of Economics

Swedish school with executive appeal

More and more executives are combining work with further education, namely an MBA. The Local explains just how the process works at the Stockholm School of Economics with its Executive MBA program. READ  

In Pictures: The Local's Property of the Week
Fastighetsbyrån

In Pictures: The Local's Property of the Week

Ever wanted to live in a loft-like apartment on the hip district of Södermalm, with a view like something out of a colourful children's book? Check out The Local's Property of the Week. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Gallery
See more images from the southern Sweden floods
Sponsored Article
Find out what gives this Swedish school executive appeal
Society
Serial chicken smuggler caught at Norway border. Again.
Society
This gold coin may be the key to solving a Swedish massacre
Shutterstock
Lifestyle
The Swedish mentor (and why you may need one)
Blog updates

17 August

Sea Fever (Around Sweden in a kayak) »

"I’m going to keep this post short and sweet as its not something I take any pleasure in writing. After much deliberation I have made the heartbreaking decision to abandon my trip after 1200km due to reoccurring injury. It is not a decision I have made lightly and it is one that has been truly devastating..." READ »

 

17 August

St. Louis strong (Blogweiser) »

"It’s typically a bad sign when my hometown makes news in Sweden. St. Louis was in the headlines here a few years ago when a tornado struck the airport. The city also caught attention after a politician talked about ‘legitimate rape’. Now, shooting and riots this week in Ferguson, a part of St. Louis, are..." READ »

 
 
 
National
Food agency warns girls: 'Don't eat stinky fish'
Politics
Reinfeldt calls for tolerance to refugees
Gallery
People-watching August 16-17
National
Sweden celebrates 200 years of peace
Society
Top ten literal Swedish words
Politics
'Terror training should be illegal': Liberal Party
Gallery
Swedes talk about 200 years of national peace
Politics
Islamic extremist shakes Sweden with TV threat
National
Teacher fined for 'Hitler salute' in German class
Politics
Swedish politician proposes ban on begging
National
Swede asks for epidural and gets disinfectant
National
Swede reports 'expensive' sex to police
Education
Sweden plans to scrap SFI for adult education
Features
Kiruna residents talk life in a town on the move
TT
Politics
Why is feminism such a hot topic in Sweden?
National
Swedish dad takes kids to Israel to learn about war
National
RIP Åle, the world's oldest eel
Society
Introducing: The Swedish crayfish party
National
Stockholm bus spontaneously combusts
Skatteverket
Sponsored Article
Introducing... ID cards and permits in Stockholm
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

662
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
http://psdmedia.se