Latvia's Parex Banka Sold $267.7 Million of Bonds to Depositors, BNS Says

Parex Banka AS, the lender taken over by the Latvian government in 2008, sold bonds worth 205 million euros ($267.7 million) to depositors facing withdrawal restrictions, the Baltic News Service said.

The notes, which will mature in February 2012, will carry an annual interest rate of 5 percent and will allow a retail bank that will be split from Parex to operate without restrictions, BNS said, citing Indra Zinkevica, a Parex spokeswoman.

The government is splitting Parex into a retail bank and an asset-management company. Restrictions on withdrawals were put on large deposits at Parex after it was seized by the state following a run on its deposits.

To contact the reporter on this story: Aaron Eglitis in Riga at aeglitis@bloomberg.net

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