Government dealing with banking sector and NLB Capital increase
The Finance Ministry said earlier this week that legislative changes have been drawn up that allow different kinds of capital increases without predetermining any of them.
The passing of the bill in urgent procedure would enable NLB, the country's biggest bank, to receive by the 30 June deadline the capital increase needed in line with rules of the European Banking Authority (EBA).
The state-run Capital Assets Management Agency's (AUKN) proposed on Monday an increase of the bank's capital by EUR 510m. The bank would raise EUR 380m by issuing more than 5.5 million new shares at EUR 68.71 a share and exchange the amount for hybrid securities.
The bank would obtain the remaining EUR 130m through a public share offering of almost 1.89 million shares at the same price.
The government, which has a 45.62% stake in NLB, announced it would not take part in the recapitalisation, but has been in talks with potential investors, including the second largest owner of NLB, Belgian financial group KBC, the EBRD and the International Financial Corporation, a member of the World Bank Group.
The state is to decrease its stake in NLB after the recapitalisation to 25% plus one share.