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. Last Updated: 07/27/2016

Boost for Latvian Exchange

RIGA, Latvia -- The stock exchange of Latvia, one of the newest of the stock markets that have sprung up in Eastern Europe, said Tuesday it took a big step forward with the start of quotations in the country's largest bank, Unibanka.

The small exchange, capitalized at just 13.6 million lats ($27.2 million), has suffered from poor liquidity because of the small size of the companies whose shares it has quoted since starting up last July.

But it has ambitious plans and is eager to attract foreign as well as more domestic investors.

The start of quotations in Unibanka, which is still half-owned by the state, was hailed by Riga Stock Exchange chairman Karlis Cerbulis.

"To date we have been illiquid, but hopefully this will help us along," he told journalists. "It's of a size and quality that any foreign or local investor could be attracted to it."

Unibanka became the Baltic nation's largest commercial bank after the crash last year of Banka Baltija, which held the deposits of around a fifth of Latvia's 2.6 million population.

Some 5.5 million shares, 50 percent of Unibanka's stock, are in public hands and they began trading with a face value of 1 lat (about $2).

By the end of the session, the stock had slipped to 90 santimes on total trade worth 3,767.40 lats , which accounted for more than 75 percent of total business at Tuesday's weekly trading session.

Many investors are wary of Baltic banks because of the crises that have hit the banking sectors of all three Baltic states.

But Cerbulis said Unibanka was a transparent bank with an international audit, and made an after-tax profit of 3 million lats ($6 million) in 1995 despite the problems caused by Banka Baltija's crash.

Andris Berzinsh, Unibanka president, said he was not worried by the slight dip in the bank's share price on the first day of trading, and expected the price to rise as people found out more about the bank and that it would soon distribute a dividend.