Latvia's Rietumu Bank fights Russia's bid to seize €16M in assets
Rietumu Banka, Latvia's fifth-largest bank by assets, is facing a new legal battle over its holdings in Russia. A lawsuit filed in August 2025 by the Russian Prosecutor General's Office demands the seizure of the bank's assets there. The dispute centres on properties linked to the bank's subsidiary, KI Invest, and follows years of financial strain since Russia's invasion of Ukraine.
As of 30 September 2025, the bank reported assets of 1.4 billion euros, customer deposits of 956 million euros, and capital reserves of 358 million euros. Yet the latest court case threatens to strip away 16 million euros in Russian real estate, including a contested property known as the 'Moscow House' in Riga.
The bank's troubles began after Russia's attack on Ukraine in February 2022. EU and US sanctions forced Rietumu to cut ties with most Russian clients, shrinking its customer base from around 13,000 to fewer than 2,000 accounts by late 2023. Deposits plunged by over 90%, from 4 billion euros to roughly 300 million euros. The bank also closed its operations focused on the Commonwealth of Independent States (CIS), leading to steep revenue losses and a net deficit exceeding 100 million euros in 2023.
Latvian regulators intervened, placing the bank under strict oversight and seizing assets tied to Russian owners, such as Aeroflot. These measures triggered legal disputes and pushed Rietumu to shift its focus toward EU-based clients. The bank halted all new investments in Russia and Belarus, freezing financial projects in both countries.
Now, the Russian lawsuit targets KI Invest, a Rietumu subsidiary holding real estate in Moscow and the surrounding region. The properties include land and buildings spanning over 13,800 square metres. If the court rules against the bank, it could lose these assets, valued at 16 million euros. However, the impact on its regulatory capital would remain limited, dropping by just four million euros.
Despite these challenges, Rietumu reported a profit before tax of 17.7 million euros for the first nine months of 2025. The bank's current financial standing shows a partial recovery, though the legal threat in Russia adds further uncertainty.
A court decision against Rietumu Banka would result in the loss of its Russian real estate holdings. The bank's capital reserves would shrink by four million euros, but its overall stability would not face immediate risk. With assets of 1.4 billion euros and a profit of 17.7 million euros so far this year, the bank continues to adapt after years of sanctions and restructuring. The outcome of the lawsuit, however, will determine whether it retains any remaining footprint in Russia.
