RIGA, Feb. 23 (Xinhua) -- The Bank of Latvia has granted the troubled ABLV Bank's request for further assistance and extended it another loan worth nearly 200 million euros (246 million U.S. dollars), the central bank said on Friday.
As a result, the central bank's loans granted to ABLV this week have totaled 297.2 million euros, but still significantly less than the 480 million euros requested by the commercial bank.
On Monday, the Bank of Latvia already provided 97.5 million euros to ABLV to make steady its operations after the bank's payments were suspended following a U.S. report implicating ABLV in money laundering schemes and bribery.
"Acting within the framework of the Eurosystem's existing regulation and taking into account the findings provided by the supervisory authority, the European Central Bank (ECB), and the national regulator, the Financial and Capital Market Commission, the Bank of Latvia has lent ABLV Bank 297.2 million euros in total this week against a pledge of highly liquid securities," the central bank's spokesman Janis Silakalns said.
The Bank of Latvia representative emphasized that the value of the securities ABLV has pledged as collateral is approximately two times higher than the value of the loan granted to the bank.
There is no risk of any public funds being lost in the transaction, the representative said.
ABLV is expected to repay the loan by August 2018.
In a report released last week, the U.S. Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) said the ABLV management "used bribery to influence Latvian officials when challenging enforcement actions and perceived threats to their high-risk business."
FinCEN has proposed sanctioning ABLV by banning the bank from opening or maintaining correspondent accounts in the United States or altogether blocking the bank from the U.S. financial system.
When the news of the report broke last Wednesday, clients rushed to withdraw their money from the bank. To curb the outflow of funds and in compliance with the ECB's instructions, the Latvian banking regulator suspended ABLV's client payments in all currencies on Feb. 18. By that time, customers had withdrawn around 600 million euros from the bank.
ABLV is the third largest bank in Latvia by assets. (1 euro = 1.23 U.S. dollars)