In its press release, SEB explained that merging its Estonian, Latvian and Lithuanian subsidiaries will boost the bank's financing capacity.

SEB Baltic division director Niina Äikas explained that this consolidation will benefit the bank's business clients in the Baltic countries, as the consolidated bank will be able to more effectively finance large and long-term projects.

The planned merger is also expected to benefit retail clients, as it will enable the consolidated bank to more quickly bring new products and services to the market. Äikas says that SEB will continue to develop its business in the Baltics.

"SEB has operated as a unified organization in the Baltics for more than ten years, and now we are taking the next step in aligning our legal structure more closely with our operating model," said SEB Estonia CEO Allan Parik.

SEB's new consolidated subsidiary bank will be headquartered in Tallinn. Pending the approval of financial regulators and the European Central Bank (ECB), the merger is expected to be completed by the beginning of 2027.

Minister of Finance Jürgen Ligi stated on social media that SEB's decision is a strong endorsement for Estonia, and proof that introducing a banking tax would have been a mistake.

"Our bank's branches will remain in Lithuania, with its larger market, and Latvia, with its more central location," Ligi noted.

"Estonia has been criticzed here at home for giving equal treatment, not privileges," he continued. "But we have indeed been pursuing a broader societal benefit as opposed to promoting artificial advantages for anyone. When resources are limited, privileges are a broader loss and a short-term perspective."

The finance minister noted that Estonia has been trustworthy and transparent with investors, rules-based and free from corruption, all while maintaining a favorable business environment and avoiding discriminatory treatment even under the pressure of public opinion.

"The banking tax is the clearest example [of this]," he highlighted. "Due to its cyclical nature, this would provide no solution for state finances, even though we love headlines about how others care for people and for Estonian banks."

Ligi said that Estonia is still wealthier than its neighbors, but this is achieved not directly, but rather by fostering a more favorable economic environment.

"And opportunistic taxation, in addition to discrediting the central bank's monetary policy – which is designed to collect money from the market to reduce inflation and release more funds as inflation falls – only undermines the system," he continued. "This is how banks' support for the economy works – not by the state exploiting their moment of profit and seizing their cyclical profits. Once again, we've managed to stay true to our values."

The minister likewise highlighted that Estonia has high-quality banking supervision.

"This has built a [strong] reputation, been innovative and taken a leading role," he acknowledged.

"A more centralized headquarters means the bank will inevitably lead to greater focus for the bank, better job opportunities and an improved reputation," Ligi concluded. "With an added element of national pride to boot."

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