Lithuanian President Gitanas Nausėda said Tuesday the European Central Bank has informally approved a plan to channel household deposits through ILTE, Lithuania’s national development bank.
Nausėda said the move is expected to fundamentally transform the country’s loan and deposit market.
"Legislative work is nearing completion, and an informal assessment and commentary from the European Central Bank has been received. I am pleased to say that this commentary is positive, that this initiative was viewed favourably by the ECB, and now only remains to implement this work," Nausėda told reporters.
In February, it was reported that Nausėda would propose legislative amendments during the Seimas spring session, allowing ILTE to invest household deposits under a state guarantee.
According to presidential aide Vaidas Augustinavičius, funds held by residents in commercial banks could be directed to ILTE, which would then invest them into the economy. It is estimated that this could attract more than 1 billion euros in additional investment, with a potential reach of up to 4 billion euros.
The President’s Office first proposed granting the national development bank access to household deposits a year ago. Augustinavičius said this would be a secure mechanism allowing for more efficient use of bank-held funds to finance the economy.
Gediminas Šimkus, head of the Bank of Lithuania, noted that residents and companies hold approximately 40 billion euros in deposits, the majority of which yield no return.
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