Brussels, 17/07/2014 (Agence Europe) - On Thursday 17 July, the European Commission ruled that an additional €37 billion of liquidation aid from Lithuania for Siauliu Bankas in connection with the winding up of Ukio Bankas is in line with EU rules on state aid to banks during the crisis.
In February 2013, Ukio Bankas was declared insolvent and part of its assets and liabilities have been taken over by another Lithuanian bank, AB Siauliu Bankas, selected in a competitive process. The cash grant of around €231.4 million was set aside by Lithuania to bridge the gap between the value of the transferred assets and liabilities, but the final valuation of assets and liabilities determined that the difference was in fact around €37.2 million larger than estimated. The original agreement made provision for the parties compensating Siauliu bank for this difference or Siauliu bank could terminate the agreement. The Lithuanian authorities chose to compensate Siauliu bank with an additional cash grant to bridge the gap. The Commission found that the additional compensation represented the difference in value of the transferred assets and liabilities and was necessary for an orderly resolution of Ukio. (EL)