BANKING SCANDAL LEADS TO GOVERNMENT CRISIS IN LITHUANIA.

Lithuania’s foreign minister Povilas Gylys and defense minister Linas Linkevicius resigned from their posts January 5 in protest of Prime Minister Adolfas Slezevicius’s "inappropriate" and "selfish" personal conduct in the country’s banking scandal. Three board members of the Bank of Lithuania resigned the same day, and the institution’s chairman Kazys Ratkevicius predicted that he may soon be dismissed. Over the weekend Lithuanian press and TV reported that Internal Affairs Minister Romasis Vaitekunas, like Slezevicius, had used inside information to prematurely terminate his fixed-term deposit with the LAIB Bank only days before the bank was declared insolvent. Slezevicius effected his withdrawal by using a proxy. Evidently, both officials were receiving interest rates double the going rate on their dollar deposits. According to Lithuanian Chamber of Commerce and Industry chairman Mindaugas Cerniauskas, the banking crisis is beginning to have ripple effects in other economic sectors. (19).

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