Banks, Financial Services, Latvia, USA

During the meeting, the officials discussed achievements of the Latvian economy and financial sector, as well as future developmentsy.

Much work has gone into overhauling of the Latvian financial sector, Reirs told Okamoto. The objective is to strengthen the capacity to prevent money laundering and terrorist financing and to achieve full compliance with international standards in this area. Latvia is committed to achieving stability and transparency in the financial sector as a basis for sustainable growth and prosperity.

The minister also said that it was one of the most ambitious financial sector reform programs in Europe to date.

"Significant progress has been made in implementing Moneyval recommendations. However, the financial sector is still facing major changes, including economic transformation to meet the climate targets and European ambitions in this area, as well as comprehensive digitization. Risks to domestic and external macroeconomic and financial stability must also not be ignored. We closely cooperate with our international partners in the fight against financial crime, and we are determined to continue making progress," Reirs said.

The most significant negative risks for Latvia so far have been mainly related to external factors, said Reirs. Slowing global economic growth, international trade situation, risks and uncertainties related to Great Britain's exit from the European Union, and growing instability in geopolitical conflict regions, including the Middle East. All of the above can not only have a negative impact on growth, but also cause drastic fluctuations in commodity prices.

The two officials also discussed the expected development of the banking environment in Latvia, reducing non-resident deposits, and other matters.