WHEN HISTORIANS DRAW up a list of the big casualties of this crisis it is unlikely that Parex banka will feature prominently.
The Latvian bank’s troubles were nowhere near as central to the health of the global financial system as Lehman Brothers’ bankruptcy, Bear Stearns’ collapse or AIG’s bailout. In central and eastern Europe, however, Parex is notorious as the region’s biggest victim to date after it had to be rescued by the government in November 2008 following a substantial withdrawal of deposits.
At the time it seemed inevitable that other banks in emerging Europe would suffer a similar fate. That they haven’t has been as unexpected as it is welcome, and reflects well on the international banks that were able to provide capital and liquidity support to their local subsidiaries in their hour of need.
As an independent bank...
