* Russian banker, with partner, suspected of embezzlement, fraud
* Follows seizure of Lithuania’s Snoras bank
* Daughter bank in Latvia likely to be liquidated-regulator
* Funds missing from both banks-officials
* People queue at Latvian bank for small withdrawals allowed (Addds arrest warrant for former bank owners, share prices)
By Nerijus Adomaitis and Aleks Tapinsh
VILNIUS/RIGA, Nov 23 (Reuters) - Lithuania on Wednesday issued a European arrest warrant for the Russian businessman whose bank was seized by the state last week after regulators found a hole in the bank’s assets and launched a fraud probe.
The collapse of Lithuanian bank Snoras has also led to the suspension of its Latvian daughter company, Krajbanka. A Latvian regulator said the bank would likely be liquidated.
The crisis, with echoes of the Baltic region’s 2008 financial difficulties, began when Lithuania seized its fifth-largest bank Snoras last week after finding 300 million euros missing..
The prosecutor’s office said it had issued a European arrest warrant for Vladimir Antonov and his Lithuanian partner Raimondas Baranauskas.
“Both the former heads of Snoras are suspected of large-scale asset embezzlement and document fraud. Baranauskas is also suspected of fraudulent accounting and abuse of office,” the prosecutor’s office said in a statement.
Latvian prosecutors have also detained officials from Krajbanka.
Antonov is well known in Sweden where he made a failed bid to buy into troubled car maker Saab.
His ownership plan was rejected by Saab creditor, the European Investment Bank (EIB), though it gave no reason.
Latvian regulator Janis Brazovskis said the money missing from Krajbanka might have been used to finance Antonov’s other projects, including Saab.
Antonov and Baranauskas have denied wrongdoing and threatened legal action against Lithuania.
In Latvia, depositors queued for the 50 lats ($95) daily withdrawals they were permitted following the government’s suspension of Krajbanka’s operations on Monday. Snoras owned 68 percent of Krajbanka.
Latvia has said 100 million lats ($191 million) was missing from Krajbanka.
Latvia and Lithuania have told bank customers the problems do not constitute any systemic risk.
“Krajbanka will, in all likelihood, have to be liquidated,” said Brazovskis, an official from Latvian banking supervisor FKTK, who has been put in charge of the bank.
“To put it simply, I and my colleagues in Krajbanka cannot fulfil all the obligations that Krajbanka has to fulfil,” Brazovskis said in an interview with television channel LNT.
During the 2008 financial crisis, Latvia had to rescue its second-largest bank Parex, which led to the Baltic state taking a 7.5 billion euro international bailout.
Latvia on Tuesday cancelled a debt sale due to increased investor nervousness. The cost of insuring the two countries’ debt has edged up in recent days.
In Lithuania, UKio Bank shares were down almost 5 percent and shares in Sialiu Bank, which has the European Bank for Reconstruction and Development (EBRD) as a major shareholder, were down 2.8 percent.
The EBRD said in a statement that Sialiu was well capitalised. Ukio Bank’s deputy chairman, Arnas Zalys, told Reuters his bank was sound and had not sought any liquidity help from the central bank. Otherwise, the Baltic states’ main lenders are subsiaries of top Nordic banks. ($1 = 0.5235 Latvian lats) ($1 = 0.7410 euros) (Reporting By Aleks Tapinsh. Editing by Jane Merriman)