Cyprus money inflow no more than 15% of Latvian non-resident deposits-FinMin.

By bne IntelliNews April 2, 2013

Since the beginning of Cyprus banking crisis, very minor inflow of Cyprus funds reached Latvia, amounting to no more than 10%-15% of non-resident deposits, BNS reports citing FinMin Andris Vilks announcement in Vilnius. At the same time a survey of commercial banks focused on non-resident activities performed by portal shows that interest in new accounts and services has grown, although the tendency is not very bold. Financial and Capital Market Commission (FKTK) announced that non-resident deposits inched up by 0.4% in February, due to increase in USD and not due to higher inflow of deposts. To remind, last week FinMin had to deny receiving any warnings from European Central Bank (ECB) regarding harbouring Russian capital fleeing Cyprus, calling the information a rumour. FinMin’s spokesman Aleksis Jarockis reminded that Latvian financial sector has high capital and liquidity requirements as well as a set of mechanisms and measures controlling the non-resident capital flows. According to unconfirmed reports by Reuters based on claims of unnamed Eurozone officials, ECB contacted Latvian officials and warned against harbouring Russian capital that might flee Cyprus after capital control measures are lifted, especially in the light of Latvia’s bid for joining eurozone. As of end of H1/12 non-resident deposits in Latvian banking system increased by 27% y/y with about 50% of total deposits of the banking system being non-resident, according to FKTK. According to FTKT total deposits increased by 5% y/y to LVL 11.64bn in H1/12.

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