Latvia gets rid of risky money in its banking system

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Latvia gets rid of risky money in its banking system

June 14, 2018 - 10:45
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Latvia is going to put additional attempts to get rid of risky money, Bloomberg reports. Deposits from holders outside European Union will fall by half within next three months. Share of such deposits by the beginning of 2019 will be just 5%, while now it is 20%.

Riga, Latvia | © Alex G, CC0 1.0

Latvia is going to put additional attempts to get rid of risky money, Bloomberg reports.

Deposits from holders outside European Union will fall by half within next three months. Share of such deposits by the beginning of 2019 will be just 5%, while now it is 20%. As of June 7, total amount of deposits in financial system was about 17,6 billion euro ($20,7 billion).

Baltic country was a subject for many money-laundering and corruption investigations. It encountered additional pressure from US financial leaders that said several banks are representing potential risk for international financial system.

Country’s central bank chose the way of eliminating risks, since it does not have enough resources to control all the money flows from countries with unstable legal system.

While Latvia is not going to use the same restriction in regards to deposits from EU, it will try to begin monitoring attempts to violate the system. Deposits from the EU account now for 12% of total.