Latvia Repays $287 Million of IMF Loan to Lower Interest Costs

Latvia repaid early 152 million lats ($287 million) of its loan from the International Monetary Fund to reduce interest payments.

The Baltic country will save almost 3 million lats in interest payments with the move, the Finance Ministry in Riga said in an e-mailed statement today.

Latvia was forced in 2008 to turn to a group led by the European Commission and IMF for a 7.5 billion-euro ($9.9 billion) loan after the second-biggest bank, Parex, needed a state rescue. It only drew down 4.4 billion euros from its bailout package.

Latvia’s gross domestic product, which plunged more than 20 percent in 2008 and 2009, has risen for two years and advanced 5.1 percent from a year earlier in the second quarter, outpacing the rest of the 27-member EU.

To contact the reporter on this story: Ott Ummelas in Tallinn at oummelas@bloomberg.net

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