Desmond's Latvian bank stake pays off with profits
Pre-tax profits at Rietumu Banka, the Latvian bank in which financier Dermot Desmond has a one-third stake, more than doubled in the first quarter of this year to €6.8m (LVL4.76).
Accounts for the first three months of 2012 show that the bank's net interest income jumped almost 35pc in the period to LVL9.98m (€14.3m), while its interest expenses were virtually unchanged at LVL3.13m (€4.5m). Its total operating income soared by just over 47pc to LVL14.7m (€21m). However, the accounts also show that its administrative expenses jumped 68pc to LVL9.2m (€13.2m) in the period.
Mr Desmond acquired his stake in Rietumu in 2005. Since then, the Baltic country has experienced a rollercoaster ride of rampant economic growth to bailout, just as in Ireland. However, unlike Ireland, the small nation that was once part of the Soviet bloc has rebounded and is now the fastest-growing member of the EU.
It was bailed out by the EU and the IMF in 2008 and draconian pay cuts were imposed on public servants to rebalance its books.