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Baltic International Bank considers the fine of FCMC as disproportionate, plans to appeal

News - December 6, 2019

Baltic International Bank (Bank) on a continuous basis is working together with the Financial and Capital Market Commission (FCMC) on the strengthening of the Bank’s internal control system (ICS) due to the constantly changing and raising requirements in the banking supervision process. Aim is to achieve accurate and clear requirements towards the Bank, it’s rights and responsibilities without allowing any interpretation. Already in 2016 Bank changed it’s business model and actively implements new business strategy – with the purpose of becoming a strong investments Bank in the Baltic region.

Therefore Baltic International Bank considers the administrative fine imposed by the FCMC and reproach about deficiencies in the internal control systems during the period from 2014 as disproportionate. FCMC started the investigation process in the Bank two years ago – in the beginning of 2018. It included the period from 2014, when the control of the customers and transactions were determined by the laws and regulations that are drastically different from the current. Bank considers that it’s arguments were not heard and listened to in essence during the period of almost two years.

Bank has achieved a lot in the strengthening of it’s ICS and expects a fair decision of regulator, not to permit the situation that year’s old supervision and control is measured with the today’s standards, although drastically different banking laws and regulations were valid during this period, several years ago.

Baltic International Bank obeys the law, fulfils banking sector regulating documents and requirements developed by the FCMC. Following the legislative changes in regards to the changes in the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing (AMLTPF) in 2016, Bank has performed all required tests, customer control, closed accounts of unsuitable customers.

Accordingly to new requirements Bank has updated and continues to upgrade several processes – Bank actively improves the internal control and supervision systems, implementing world renowned IT systems tested in the financial market, invests in the raising of it’s employees professionalism and qualification, also Bank purposefully modernizes and automatizes a range of procedures. Every year Bank invests close to one million euros to strengthen it’s activities in the AMLTPF area and constantly adapt to the changing challenges and regulatory framework of the sector. Baltic International Bank wants to emphasize that it is the only private bank in Latvia that has invited internationally recognized AML area rating agency from USA Sigma Ratings that during the January 2019 evaluated Bank’s ICS with rating BBB+, placing it amongst industry leaders and attesting compliance of ICS with the Bank’s chosen model and customer portfolio. Already currently Bank cooperates with international auditor companies representing the Big Four to proactively strengthen the ICS area.

We would like to emphasize that the decision adopted by the commission will not impact the customers of the Bank and daily operations of the Bank. Baltic International Bank is a reliable and stable participant of the financial market in Latvia and partner in Europe for 26 years’ already.

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