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SEB Bank decides not to extend Riga public transport company’s overdraft agreement

Photo: facebook.com/rigassatiksme.lv
SEB Bank has decided to not extend Riga municipality’s public transport company Rīgas satiksme’s overdraft agreement of EUR 3.2 million, as confirmed by the company’s representative Baiba Bartaševiča.

According to information published by the company, the management of the public transport company had met with SEB Bank representatives last week. During this meeting, the company’s management received confirmation that the bank does not plan to change its decision regarding the halting of the overdraft agreement.

At the end of 2018, SEB Bank decided to not extend the overdraft agreement on EUR 3.2 million. «Because these funds are reserved to ensure short-term liquidity, which is provided by Riga City Council using compensation payments for the provision of public transport services, this will not affect the company’s work,» claims the company’s representative.

Rīgas satiksme has signed multiple loan contracts signed with SEB Bank for an amount that exceeds EUR 20 million.

During the meeting, SEB Bank’s representatives stressed that a transparent and politically neutral approval of a new board and council for the public transport company will play a major role in future decision-making processes.

As it is known, Latvia’s Corruption Prevention and Combating Bureau has commenced a criminal process in regards to three procurements organized by Rīgas satiksme. Law enforcement authorities are investigating bribery and money laundering.

In response to the investigation commenced by KNAB, all board members of Rīgas satiksme stepped down. The new board with Anrijs Matīss at the helm then decided to perform an internal audit to determine the state of the company. The audit showed that part of the EUR 50 million loan SEB Bank had provided for the purchase of 20 low-floor trams was used to pay wages simply because the company had no money. This shortage of funds was covered by the temporary board using Riga City Council’s provided grant of EUR 17 million provided last year. Anrijs Matīss has since left the company.


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