Bank of Lithuania

Taking into consideration the request by AB SEB bankas, the Board of the Bank of Lithuania issued to it a permission which allows the bank to make premature repayment of the following two subordinated loans: one loan amounts to EUR 25 million (an equivalent value is LTL 86.32 million) and another one amounts to EUR 45 million (an equivalent value is LTL 155.376 million). These loans were received from Skandinaviska Enskilda Banken AB under the agreements of 14 December 2005 and 26 June 2007, and they are to mature respectively on 14 December 2015 and 26 June 2017.

AB SEB bankas pointed out there was no further need for these subordinated loans and it would maintain sufficient capitalisation level after their repayment which would also allow for reducing the bank’s borrowing costs.

Subordinated loans are permitted as Tier II capital. Under the planned amendments to the European Union legislation known as Basel III, the most significant for banks will be the highest quality Tier I capital.