Danske Bank said it is adopting a policy of not lending to parties, in an effort to stay out of daily politics.
Similar decisions have previously been made by other banks in Estonia, such as SEB, LHV, DNB and Svenska Handelsbanken, according to a report by the business daily Äripäev in light of election season.
"The bank does not wish to partake in day to day politics in a lending relationship," said Aivar Rehe, CEO of Danske Bank's subsidiary in Estonia.
Äripäev noted that another reason not to lend to cash-strapped political parties is that their cash flows depend significantly on membership fees and donations, which makes it difficult to evaluate their sustainability.
Estonia's local government elections take place on October 20.