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Swedish banks warned on Latvian economy

TT/The Local · 3 Oct 2009, 08:53

Published: 03 Oct 2009 08:53 GMT+02:00

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The two banks have interests in the Baltic country and a financial collapse could lead to a ’nightmare scenario’ writes newspaper Svenska Dagbladet.

The news comes as Borg addressed EU finance ministers at an informal meeting in Gothenburg this week. He warned Latvia to get its finances in order if the country is to rely on continued international support.

”Political problems in Latvia seem partly to be making a comeback,” Borg said. ”It’s important that the government fulfils the international agreements they have agreed upon.”

In December 2008, the EU International Monetary Fund put together a rescue package for Latvia to the tune of 80 billion Swedish crowns.

Borg questioned the country’s budget decisions and stressed the need for the country to take action.

”The patience of international organisations is very limited,” Borg added. ”They don’t have much room to manoeuvre.”

Story continues below…

Borg will attend the annual meeting of the International Monetary Fund in Istanbul next week.

TT/The Local (news@thelocal.se)

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Your comments about this article

09:39 October 3, 2009 by hjoian
is now the right time to pull my savings from Swedebank? Is there capital protection in Swedeish banks???
11:29 October 3, 2009 by Nemesis
Swedbank again.

When are people going to realise that bank needs to be temporarily nationalised.

Then everyone above branch manager needs to be put fired, with a ban on future employment in the banking sector. That ban would stand for two or three years until the ex-bank employees took there case to the Internaional Court of Justice, but long enough to break there links to banking and stop further damage from them.

Following that, new senior staff need to be appointed.

Then the company should be refloated which would need to occur as soon as possible, literally within four to six months of nationalisation.

when refloated the Swedish people had to pay to bail out the banks. Everyone who was born in Sweden should have the shares equally shared out amongst them, excluding all employees of banks.

That would send a message to them to get there act together.
12:07 October 3, 2009 by Texrusso
Everyone who was born in Sweden,,, Stupid rant.... how about every swedish citizen?
14:26 October 3, 2009 by zircon
Mr Borg sounds very nervous... What's the panic in this 'depeche' all about?
15:27 October 5, 2009 by jerkinslv
It's interesting that Sweden's Minister of Finance is suddenly well aware of situation in Latvia and also expresses his concerns about political situation. It is really interesting given the FACT that prime reason of Latvia's problems stems from criminally irresponsible lending by Swedish banks in Latvia a couple of years ago that guaranteed astronomical rise in property prices, abnormal income and inflated expectations about future income and thus spending covered by those expectations only.

Where was Sweden's conservatism and concern then when it allowed Swedbank and SEB to lead these actions in Latvia and have record profits?

It is not only time for us Latvians to fulfill "international agreements" but also for Government of Sweden to take official responsibility for the crisis it has caused and to pay the price as well.
12:12 October 12, 2009 by Jan-Bug
I'm not commenting on this article in particular, just want to puke my disgust over The Swedish Government in general and on all levels, which is a big joke to start off with. It's not for nothing that they're called the "Muppet show". They have absolutely no clue but all of them politicians up there on their "thrones" will always continue to crap on your head and to top it all they'll have the guts to ask you for a piece of paper to wipe themselves clean! They have no respect whatsoever towards their own country and citizen and they are proofing that everyday of the year. They take us for stupid and incompetent and not worth the while spending thoughts or money on. Tax money by the way that WE, the people are filling the Governments accounts with and that obviously they are allowed to spend freely. Politicians will always find a way to brush their crap under the carpet or put the lid on when a storm is approaching and it doesn't really matter in what field. The Swedish Government are not there to benefit their own citizen in any way. You are on your own here now and it is going to get even worse. Just like in the US. The ones so famous "well fare" Sweden is looong gone. A time in history that never will return and you don't have to go very far to find out how and where the S.G have failed their people MISERABLY cause it's EVERYWHERE! The S.G are just a bunch of lying fawny cowards.
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