Riga - A government bailout of Latvia's largest indigenous bank, Parex Banka, was set to be finalized Monday after the European Commission (EC) signalled it would not block the deal.

Latvian Finance Ministry spokesperson Diana Berzina told Deutsche Presse-Agentur dpa that an "unofficial okay" had been received from the EC along with their comments on the deal.

She added that final confirmation from the EC was likely one or two days after the legal document was due to be signed in a closed meeting on Monday night.

Washington

Stockholm - Stockholm-based Carnegie Investment Bank AB lost its operating license Monday and has been taken over by the Swedish National Debt Office.

The Swedish Financial Supervisory Authority (FSA) on Monday said Carnegie during a long period of time had taken "exceptional risks" by giving large loans to a single client.

Carnegie has been under review by the financial watchdog since it recently disclosed a writedown of 1 billion kronor (126 million dollars) over "an individual credit commitment" in its third-quarter report.

Stockholm  - Stockholm-based Carnegie Investment Bank AB on Monday unveiled plans to issue new shares worth 1.2 billion kronor (151 million dollars).

The announcement came shortly the board of the Swedish Financial Supervisory Authority (FSA) was to meet to decide on possible sanctions against Carnegie.

Carnegie has been under review after it disclosed a writedown of 1 billion kronor over "an individual credit commitment" in its recent third-quarter report.

The new issue consisted of two parts of which 400 million kronor was for a new shareholder and the rest to current owners, the investment bank said.

The new issue hinged on Carnegie keeping its licences to operate.

Riga - Latvia's largest

Riga - Latvia's largest indigenous bank, Parex Banka, confirmed that it was seeking government help in what amounts to a partial nationalization in a surprise move on Sunday morning.

Parex Banka is the second largest bank overall in the Baltic country. It posted profits of more than 12 million lats (22 million dollars) in the first nine months of 2008.

A statement released by Parex in the early hours of Sunday morning said, "In accordance with the terms of the agreement between the bank and the Latvian state, 51 per cent of Parex Banka's shares are being sold to the state."