According to the announcement from court bailiff Andrejs Glumovs in the Latvian Herald indicates that on Friday, the 6th of January, it is planned to auction off an apartment in Riga and house in Jurmala owned by former Parex Bank owner and board member Valērijs Kargins.
The apartment in question is 117.1 m2 large and is located on Alberta Street 8 in Riga. The price of this piece of real estate is EUR 210 000, whereas the starting bid is EUR 5 000. The auction price is not charged with VAT.
The piece of land located on Piestātnes Street 11 in Jurmala that is 3 356 m2 large (1 464 m2 is leased), as well as the house located on this piece of land (341.9 m2) along with the garage (102.2 m2) are also auctioned off. The estimated value of this piece of real estate is EUR 443 000 and the starting bid is EUR 8 000.
The auction is to commence at 13:00 p.m. on the 6th of January and to conclude at 13:00 p.m. on the 6th of February.
Both auctions are organised by Reap LLC, which is indirectly owned by the Latvian state. The 8th of December 2022 marked the coming into force of the ruling of Riga Regional Court that satisfies the lawsuit composed by Reap LLC against former Parex Bank owners and board members Valerijs Kargins and Viktors Krasovickis for the enforcement of losses worth EUR 81 180 583.
Initially Riga Regional Court rejected the company’s plea, but Reap submitted a cassation complaint. The Supreme Court cancelled the ruling and returned the case for a repeated reviews. In the second viewing of the case the court ruled in Reap’s favour.
The plea is related to a previously viewed civil case in which Reverta, which took over Parex Bank’s duties and rights, attempted to enforce EUR 85.5 million from the two former bank owners.
Reverta justified the lawsuit against the two former Parex Bank owners by stating that they did perform their duties as the bank’s board members in an honest and fair way. Specifically, between the 1st of January 1995 and the 5th of December 2008 there were many deals signed between the two bank owners, their associates and relatives. These deals were not in line with market rules, generally applicable practice in such transactions and the terms on which the bank offered similar transactions to other customers.
According to Reverta, these deals allowed the former bank owners to make money at the bank’s expense. Because of this, Reverta requested enforcement of EUR 85 465 375 from Kargins and Krasovickis for 14 deposit and loan deals.
The Supreme Court partially satisfied the lawsuit from Reverta and enforced from Krasovickis and Kargins EUR 4 284 792, as well as court expenses of EUR 230 550 – EUR 4 515 342 in total. The lawsuit for enforcement of EUR 81 180 583 was rejected. The former bank owners submitted an appeal, but the Senate decided to leave the ruling of the Supreme Court unchanged.
As previously reported, on the 10th November of 2008 then the Minister of Finance Atis Slakteris, then the governor of Hipotēku banka Inesis Feiferis and Kargins signed a contract that provided for the transfer of 51% of shares of Parex Bank to Hipotēku banka. Kargins and Krasovickis were each paid LVL 1 for these shares.
Later the state took over the rest of the bank’s shares. The total state support provided to Parex Bank reached EUR 1.7 billion. Less than half of this amount has been recovered so far.
Parex Bank’s worthwhile assets were handed to Citadele Bank in August 2010. Since then Parex Bank has functioned as a solution bank. Its main purpose is recovering investments provided by the state. In May 2012 Parex Bank started operating under the name Reverta. Its bank licence was annulled.
In 2017 it was decided to commence Reverta’s liquidation. A contract was signed with Gelvora LLC and Lithuanian Gelvora on the sale of the credit portfolio.
Also read: ERDB ceases participation in capital of problematic asset manager Reverta