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Key Lithuanian bank gets capital boost from EBRD
Vilniaus Bankas (VB), the largest private bank in Lithuania and a key player in the country's expanding private sector, will be better able to meet growing demand for its finance following a DM 20 million (ECU 10.2 million) subordinated loan from the European Bank for Reconstruction and Development (EBRD).
"Over the past two years, Vilniaus Bankas has significantly increased its lending to private sector enterprises, enhancing its reputation as a sound financial institution," said David Hexter, Deputy Vice President of the EBRD. "This trend is expected to continue as the Baltic economy develops and the demand for bank financing increases. By assisting the institutional development of the backbone sector of the country's economy, the EBRD is encouraging further capital contributions to the local banking market."
The subordinated loan will enable Vilniaus Bankas to sustain its projected growth while retaining sound capital adequacy. The proceeds of the loan will be channelled to Lithuanian private businesses to help them grow.
Vilniaus Bankas was established in March 1990 and operates as a universal commercial bank. As of 31 December 1997, it had USD 459 million (ECU 412 million) in total assets,USD 43 million (ECU 39 million) in total equity and USD 12 million (ECU 11 million) in net after-tax income.
Betwen 1996 and 1997, VB was one of the fastest growing banks in Lithuania and is estimated to have achieved a market share of approximately 23 per cent in total banking assets, corporate loans and customer deposits. VB has a total of 930 employees in its Vilnius headquarters and its domestic network of 14 branches.
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