Latvia’s Mortgage Bank Needs $69 Million Capital Boost, Ir Says

Latvia’s state-owned Hipoteku un Zemes Banka AS needs 38.4 million lati ($69 million) in capital after the European Commission asked the country to repay money that had been improperly used, Ir reported.

The mortgage lender had added European Regional Development money, allocated for lending to businesses, to its capital base during the Baltic nation’s economic crisis when Hipoteku had a combined net loss of about 118 million lati over 2009-2010, the Riga-based magazine reported, citing the Finance Ministry and the bank.

The capital increase, which follows a 25 million-lati boost in June, was included in budget amendments adopted this month, the magazine reported.

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

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net.

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