Analytics, Banks, Financial Services, Investments, Latvia, Rating

“The assessment carried out by S&P Global is an extraordinary evaluation related to the U.S Department of State’s announcement on ABLV Bank and the following restrictions imposed on the bank’s operations by the European Central Bank (ECB) and the Financial and Capital Market Commission (FCMC),” representatives of the Treasury said.

S&P Global indicates that Latvia’s direct fiscal exposure to ABLV Bank’s issues is limited and insignificant relative to Latvia’s financial capacity.

S&P Global does not expect the current situation in Latvia’s financial sector to leave a negative impact on the rest of the Latvian banking sector, the financial institutions serving resident clients.

The ratings agency also noted that the current situation can affect Latvia’s non-resident banking sector, but that would have a limited impact on the Latvian economy and would not pose risks to Latvia’s financial stability.

S&P Global gives a positive assessment of the Latvian government’s fiscal policy, Latvia’s current steady economic growth and the projected 3% annual GDP growth forecast for the next four years. 

S&P Global expects strong domestic demand, inflow of EU funding-supported investment and external factors conducive to trade to support Latvia’s economic growth in the medium term.

S&P Global is due to release its next scheduled report on Latvia’s credit rating on March 23.