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Latvia's Biggest Bank Fights Off Deposit Run

AP
Monday, 12 Dec 2011 | 5:14 AM ET

Latvia's largest bank is scrambling to contain a run among depositors gripped by fears of the bank's imminent collapse.

Keith Brofsky | Photodisc | Getty Images

The panic among Swedish-owned Swedbank's depositors began Sunday after rumors spread that the financial institution was facing legal and liquidity problems in Estonia and Sweden.

Swedbank's Latvian chief Maris Mancinskis on Monday called the rumors "absurd." He said the bank is functioning normally and all depositors will have access to their funds via bank machines.

Mancinskis said some 10,000 Latvians withdrew over 10 million lats ($20 million) on Sunday.

Latvia's 10th largest bank, Latvijas Krajbanka, is currently being liquidated after regulators uncovered fraud on a massive scale. Depositors were left without access to their money for days.

Contact Europe: Economy

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