Lithuania’s banking regulator said hundreds of millions of dollars in assets may be missing from Bankas Snoras AB after the government took over the Baltic nation’s fifth-biggest lender on concern it may be performing illegal operations.
More than 1 billion litai ($392 million) of assets may be unaccounted for, central bank Governor Vitas Vasiliauskas told reporters yesterday in the capital, Vilnius. Snoras’s operations were halted until Nov. 21 and a state administrator appointed after the lender ignored recommendations to reduce its credit risk, the regulator said in a statement.
The Baltic region is recovering from the worst recession in the European Union, during which Latvia sought an international bailout after rescuing Parex Banka AS to protect it against a run on deposits. With 19.4 billion litai in foreign-currency reserves, Lithuania can handle the takeover of Snoras, which has a 10 percent market share, according to AB DnB Bankas economist Jekaterina Rojaka.
“This isn’t a systemic problem for the banking sector,” Rojaka said yesterday in a telephone interview from Vilnius. Still, “the situation requires speedy and smooth action to contain panic and prevent a fall in government bonds.”
Lithuania’s 10-year dollar bond declined today, sending the yield up 0.12 percentage point to 6.39 percent, the highest since Oct. 13. The six-month interbank rate, or the Vilibor, increased 10 basis points to 2.23 percent, the highest since Aug. 13, 2010. The NASDAQ OMX Vilnius index fell 2.53 percent.  

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