Latviski English По-русски
Tuesday 25.09.2018 | Name days: Rauls, Rodrigo

Parex CEO: if money is recovered, the employees have to get bonuses

(+1 rating, 1 votes)

The employees of Parex Bank should be paid premiums if most of the money that the state has invested, is recovered, the new CEO of Parex Bank Christopher John Gwilliam informed BNN.LV.

He indicates that it is going to be a difficult task to recover at least a part of the money, but almost impossible to regain the whole amount of it, adding that Parex Bank can no more be considered as an actual bank, it is more like a work-out bank.

C. Gwilliam makes a lasting impression – he is joyful yet deeply engaged in work at the same time.

First month in Latvia… What conclusions have you drawn? What are the impressions of Latvia?

I feel very good here. To be honest, I did not know much about Latvia before; however I had read about it, because I am interested in the history of Europe and its development in general. There is very nice climate here, even though when I arrived, it was too hot for me, it was in July. I cannot wait for severe and long winter. I prefer snow and cold weather, as well as storms.

I am having the greatest problem with finding an appropriate apartment, because I like if there is a balcony. However it turns out that there are only large flats with balconies in Riga, but I do not need a large one. What regards Latvia, it can be seen and felt that recession has affected the country. I have an impression that the situation is getting better though. The fact that the traffic on the bridges increases serves as an example (Parex headquarters is located at Suspension Bridge (Vanšu tilts)).

It sounds like you like challenges. Is Parex Bank a challenge? Why did you decide to work there?

Parex Bank is definitely a challenge. I enjoy challenges and this could be one of the most impressive ones of all I have ever had. I have never worked as an investment banker in the classical sense due to which I have never favored fulfilling duties only because of bonuses. I did not consider it as a good system of the financial world.

I have always been interested in completing the task without desiring bonuses that had gained huge popularity in the financial world. Once I even argued with my colleagues about the specification of a banker’s work, as I was convinced that bankers should not be paid bonuses.

The nature of a bankers’ work requires completing tasks as well as possible without thinking about any additional payment. And if they manage to do it, it will also be reflected in their salaries, but not in a form of premiums, because the system of them ruined the financial world and market. The whole world could witness this some time ago – we saw to what extent  people took risks and speculated, in order to get bonuses and how awfully wrong everything turned out after all.

Then you are against bonuses and you will not receive them in Parex Bank after achieving certain objectives?

I did not say that I am against bonuses in general. I said that I was against them in the financial world previously in connection with the speculations. I believe that if a person completes a very complex task and achieves the set goals – he or she deserves a bonus. Paying premiums for speculative transactions is something quite different. Once we have touched upon the topic – there is huge and complicated work ahead of Parex Bank. If we achieve good results, which means, if we recover a big part of tax payers’ money – the employees should get bonuses. This is, of course, a very sensitive issue but this is my opinion. It still must be considered very carefully. This theme has not been discussed completely yet, not to mention the fact that there is no agreement reached on the premiums. However, I would strongly recommend that Parex employees receive bonuses, in case we accomplish this extremely difficult task to recover the most part of the state investments. If we fail in doing this – there will not be any additional payment. I am positive that it will be extremely difficult to convince the government that the employees have earned a premium, if an outstanding work is accomplished. People have to understand that it will be very difficult to regain Parex money. It would be almost as a miracle if we managed to recover all of the investments. The more money we get back, the greater is the achievement. I remind one more time – I do not think that the premiums should be paid right away. They ought to be paid only if excellent results are achieved. There will not be any bonuses if we do not manage to reach the objectives.

Parex Bank can no longer be considered as a bank in its classical sense…

That is right. The only thing we do is saving money for the state. We could be regarded as a sort of cash recovery bank or institution (work-out bank). I am not sure I should say this, but we are not a full-service bank indeed. The only «service» we provide is collecting money for the state.

How do you evaluate the possibility to recover the investments, now when you have got acquainted with the situation?

The situation of Parex is very serious. It is a bank with many bad loans and assets. If we managed to get back even a part of the money, it would be a great achievement. It is unlikely that we will ever be able to operate with profit. Great success would be maximizing the returns from the assets. We are going to do everything possible not to suffer losses. It would be an overexaggeration to talk about profit in such a situation.

What is the most realistic scenario, how much of the invested money could be recovered?

I am here for already a month now, but I still cannot answer the question. It is impossible. I have already examined many assets. It will be hard work to get back even a part of the money.

What is the reason exactly you were appointed as the new Parex CEO?

I would like to think that it was because of my experience and skills. Obviously I made the correct impression.

Latvians are always interested in salary issues. What is your pay at Parex?

I was warned that this is a topical question in Latvia and that it will definitely be asked. This information will be publicly accessible, when the time comes – when we have completely agreed upon it. What I can say is – that I would be paid better if I worked in London in a similar post. I took up the position not because of money, but of different reasons. First of all, because I had a feeling that this job was meant for me. Returning to the question… I am surprised how much information on private entities and their pay is publicly available. It is quite strange.

Do you feel any pressure at work taking into account your responsible post and the political background?

The work will be difficult for sure. When thinking about these processes and the background I start doubting whether I have asked enough (laughing).

What are the biggest obstacles of Parex Bank at the moment?

I do not think it is a secret that the System of Justice is slow in Latvia. We have discussed this issue with the Ministry of Justice. It is difficult to explain, but it could be that the judges do not have enough specific experience of difficult and complex tasks. The case of Parex is the first precedent in Latvia. There are many new processes and regulations that have to be introduced. This definitely delays the recovery of the investments. However this is not meant as criticism to judges. It is simply that the whole system has to be reconsidered and people and institutions in responsible posts have to have an appropriate experience.

What are the positive aspects of Parex? What could help you to achieve the objectives?

People! We are a great team! The bank employs experienced and motivated people with knowledge of finances. We have also maintained good work relationship with «the other bank» or «the good bank» (Citadele). We have to rely on them in connection with IT and other services. As for the employees – we still have to work on their way of thinking and the philosophy – from classic bank employees, they have to become financial experts in recovering investments. It will take some time.

Leave a reply

  1. Nyvaeh says:

    A few years ago I’d have to pay smoenoe for this information.

PHOTO: Pope Francis visits Riga Cathedral and meets seniors at St Jacob’s Cathedral

Pope Francis visited both Riga Castle and Riga Cathedral, where a service was held under his supervision. There he met with different Latvian officials. After that, the pope met with senior citizens at St Jacob’s cathedral.

Pope Francis arrives in Latvia for an official visit

Pope Francis arrived in Latvia on Monday, 24 September. He was greeted at the airport by President Raimonds Vējonis, Archbishop Zbigņevs Stankevičs and other public figures.

Week in Lithuania. President proposes amendments to restrict bailiffs' remuneration

Lithuanian President Dalia Grybauskaitė is putting forward amendments aimed at restricting bailiffs' financial remuneration to up to 15 per cent of the amount recovered.

BNN summary of the week: pre-election heat, rule of law in Latvia, Baltics prepare for Pope’s visit

BNN offers a summary of this week’s topical news in a variety of categories: Elections; Change; Stagnation; Fight; Visit; Investigation.

Court reschedules viewing of criminal case due to Non-citizens Congress leader’s poor health

Riga City Vidzeme Suburb Court announced today that the viewing of the criminal case in which leader of Non-citizens Congress Aleksandrs Gapoņenko is accused of inciting national hate will be postponed to a later date.

Producer prices in industry up 1.0% in Latvia in August

Compared to July, level of producer prices in the Latvian industry rose by 1.0 % in August 2018. Level of prices of products sold on the domestic market grew by 1.9 %, but of exported products – went up by 0.1 %.

Bishop: priest suspected of sexual abuse to be operated on in hospital

Pāvels Zeiļa, who is a priest of Rezekne Aglona diocese and the suspect in the criminal case regarding sexual violence and human trafficking, will undergo a complicated surgery on Friday, 21 September, as reported by Bishop Jānis Bulis.

Study: residents withdraw money from ATMs less often but in larger amounts

Every now and then discussions about dropping cash money altogether become active in society, AS PrivatBank representatives say.

HND Grupa design company, involved in Zolitude tragery, declared insolvent

Building engineer Ivars Sergets company HND Grupa, which was involved in the case revolving around the Maxima supermarket that collapsed in Zolitude, killing 54, not five years ago, has been declared insolvent, as reported by Latvijas Avīze.

Deputy Chief of State Fire and Rescue Service suspected of misappropriation

Latvia’s Interior Affairs Ministry’s Internal Security Bureau has detained deputy chief of State Fire and Rescue Service Ints Sēlis and one other official – a senior inspector, as reported by Panorāma programme of LTV.

Washington sanctions China for buying Russian military equipment

U.S. government has introduces sanctions against the Chinese army over a purchase of fighter jets and missile systems from Russia, despite a U.S. sanctions law targeting Moscow for attempts to sway in the 2016 U.S. election.

Autumn expected to begin soon in Latvia

Friday, 21 September, is expected to be warm in Latvia. Sun and considerable amount of clouds are expected, but not precipitation. Wind will draw in from the south, reaching a speed of 15-17 m/sec in western and central regions, as reported by Latvia’s Environment, Geology and Meteorology Centre.

Brexit: a finish line with no end in sight

Less than 200 days are left before Britain officially leaves the European Union. The state of the agreement between Britain and EU only serves to create more chaos, from which neither Britain nor EU, or even Latvia will benefit.

EU underlines to London: No-deal Brexit also option

European Union's top officials and member state leaders planned to push for a Brexit deal in October, while urging London to give ground on the issues trade and the Irish border by November, to avoid a no-deal Brexit.

Lithuanian PM, a presumable presidential hopeful, set to curb grocery price growth

Having chastised food retailers on many occasions for high grocery prices, Saulius Skvernelis, the Lithuanian Prime Minister, stepped forward in the bid to harness local supermarkets. The presumed presidential candidate of the ruling Farmers and Greens (LVŽS) has summoned this week executives of major retail food chains, scolded them and reaffirmed his pledge to rein in the edging up prices.

Industrial prices in Estonia – up by 3.4% on year

The industrial price index in Estonia has risen from August 2017 to August this year by 3.4%, official statistics show.

Latvian parliament approves transition to competence-based approach in education content

On Thursday, 20 September, Latvia’s Saeima approved in the final reading amendments to the Education Law, necessary for the gradual introduction of competence-based approach in education materials.

Latvian Saeima wants to disallow shareholders to work in company management board

On Thursday, 20 September, Saeima approved in the first reading amendments to the Credit Institutions Law that provide for multiple measures to enhance Latvia’s finance system and its long-term stability, as reported by the parliament’s press-service.

Aglone Council prohibits residents from organizing protests during Pope Francis’ visit

A protest against the Catholic Church’s ban on abortions and expression of shock in relation to the recent sex scandals involving Catholic priests was planned to take place in Aglone during Pope Francis’ visit, but the city council decided to disallow them.

Latvian parliament conceptual supports pension bonus indexation

On Thursday, 20 September, Saeima supported in the first reading several initiatives for a more rapid pension climb for several groups of pensioners, as reported by Saeima press-service.

Majority Saeima deputies support open president vote; UGF members fail to decide unanimously

On Thursday, 20 September, amendments to the Constitution regarding open election of the state president were approved in the second reading.

Four Estonian parties have strong support, enough to enter Riigikogu

Four Estonian parties are believed to currently have enough support to enter the Estonian parliament, a broad opinion poll showed, as leading parties compete for voter backing.

Vitol Group concerned over state of rule of law in Latvia; turns to state officials

One of the largest energy resource traders in the world – Vitol Group – has sent a letter to Latvia’s highest ranking officials, expressing deep concern over the rule of law and application of legislative acts in the litigation between LatRosTrans and Polocktransneft Druzba over the EUR 66 million worth technological oil.

As Pope heads to Baltics, more attention to Catholic sex abuse

The time, when Roman Catholic Pope Francis is set to visit the Baltics, greatly differs from the visit by Saint John Paul II in 1993. There is public resentment over the countries spending several million euros to host the trip of the pontiff and the Catholic sex abuse scandals are topic of discussion.

Officials asked to take responsibility for misuse of state resources

If misuse of state resources takes place, officials have to take responsibility and pay for the damages caused to the state, says Public Expenditure and Audit Committee chairman Andris Bērziņš.

Most read

Most commented

Newest comments