News2019.08.29 14:00

MEP threatens to turn to ECB over Lithuanian central bank chief

Gytis Pankūnas, 2019.08.29 14:00

Lithuanian MEP Stasys Jakeliūnas says he will turn to the European Central Bank over the actions of Lithuania's central bank governor whom he has accused of obstructing a parliamentary investigation.

Jakeliūnas, who used to head the Lithuanian parliament's Committee on Finance and Budget before his election to the European Parliament last May, led an investigation into the causes of the 2009-2010 economic crisis in Lithuania. He said that Vitas Vasiliauskas, the head of the Bank of Lithuania, would not cooperate in the probe.

“We will return to the actions of the Bank of Lithuania governor, evaluate them both in Europe and here, in Lithuania,” Jakeliūnas said during a press conference on Thursday. “The process will take place in September-October. I may have opportunities to discuss the matter with the future president of the ECB, Ms Christine Lagarde. I will turn to her institution.”

He also said that his report, which still has to pass a vote in the Lithuanian parliament, would be presented in the European Parliament as well.

The report of the Committee on Budget and Finance claims that the 2009-2010 financial crisis in Lithuania was made worse by pro-cyclical fiscal policies pursued by previous governments and lending practices of the country's private banks, most of them owned by Scandinavian parent companies.

One of the more controversial statements in Jakeliūnas' report maintains that banks charged unreasonable interest rates on mortgages by manipulating the local interbank rate, VILIBOR, and that the Bank of Lithuania failed to properly regulate them.

He said on Thursday he planned to circulate the investigation results more broadly and initiate “legal processes of some sort”.

The opposition has accused Jakeliūnas, who represents the ruling Farmers and Greens Union, of political bias and score-settling. Vasiliauskas has rejected the politician's accusations, saying they are motivated by personal grievances.

Read more: Scandinavian banks ‘caused’ financial crisis in Lithuania, Seimas investigation finds

Read more: Are Scandinavian banks to blame for 2009 crisis in Lithuania?

Read more: Lithuanian central bank governor denies interest rate manipulation during 2009 crisis

Commenting on Jakeliūnas' announcement, Bank of Lithuania chief Vasiliauskas said that the politician had every right to raise his concerns to whichever European authority, but rejected the accusations.

“I do not see anything wrong in my statements. [...] I reject any insinuations by Mr Jakeliūnas that I obstructed the parliamentary investigation,” Vasiliauskas said.

He called Jakeliūnas' initiative “finance archeology” and said he doubted that Lagarde had heard anything about the investigation at the Lithuanian parliament.

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