Lithuanian Court Agrees to Hear Ukio Bankas Bankruptcy Request

A Lithuanian court said it would consider starting bankruptcy proceedings against Ukio Bankas AB at the request of the central bank, which shut the lender in February citing risky loans to related parties.

Kaunas District Court agreed today to consider the Bank of Lithuania’s request in a written process with a hearing on May 2, court spokeswoman Gintare Putnikiene said by phone.

Ukio was Lithuania’s fourth-largest bank by deposits when it was closed. The lender’s liabilities exceeded its assets by 1.2 billion litai ($463 million) as of March 18, the central bank in Vilnius, Lithuania’s capital, said last week, citing financial statements prepared by Ukio’s temporary administrator, Adomas Audickas, and auditor KPMG Baltic.

“The bank was and remains insolvent,” the Bank of Lithuania said on its website on April 18, proposing that the court name Valnetas UAB as Ukio’s bankruptcy administrator.