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Greensill Bank: Financial regulator finds compensation event

2021-03-16T18:49:33.639Z

The Bremen District Court has opened insolvency proceedings against Greensill Bank - after an application by Bafin. The supervisory authority has now created the conditions for private investors to get their deposits back.



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Entrance to the Greensill Bank in Bremen

Photo: Sina Schuldt / dpa

Private investors can expect to get their deposits back at the insolvent Greensill Bank in the next few days.

The financial supervisory authority Bafin has determined the compensation case.

This is the basis for the deposit insurance to take effect.

Earlier in the day, the Bremen District Court opened insolvency proceedings at the request of Bafin.

The deposit protection fund will contact the savers concerned shortly, announced the BdB banking association.

The compensation will be made within seven working days.

At Greensill Bank, 74.96 million euros are secured per customer.

According to insiders, the fund is preparing to pay out around three billion euros to private savers - the biggest burden since the bankruptcy of the US bank Lehman Brothers in 2008.

Numerous cities and municipalities will not benefit from this, however, since deposits from institutions such as the federal, state and local governments are no longer subject to the protection scheme since the beginning of October 2017.

According to insiders, this customer group had invested around 500 million euros at Greensill.

On Tuesday, the court appointed Hamburg lawyer Michael Frege to be the insolvency administrator.

The brother of the singer Campino from the rock band "Die Toten Hosen" knows about bank failures.

With the German subsidiary of Lehman Brothers and Maple Bank, he had handled the two largest bank insolvencies in Germany in recent years.

In the case of Lehman, his three-digit million fee, which is based on the bankruptcy estate, made headlines.

However, he was able to fully compensate the creditors.

How much Frege can now secure at Greensill Bank is decisive for how much money the municipalities will get back.

In general, the bankruptcy rates are significantly higher at banks than at other companies.

Several municipalities accuse the Bafin of having informed too late about the problems at Greensill.

The financial supervisory authority had closed the Greensill Bank at the beginning of March due to the threat of over-indebtedness and reported the management to the Bremen public prosecutor's office because no evidence could be provided for claims in the balance sheet.

According to the city of Monheim am Rhein, 26 affected cities and municipalities want to get together in order to get back part of their deposits from the bankruptcy estate.

In addition, liability claims are to be examined jointly.

The Bremen institute had collected savings deposits from private investors via online portals such as “Weltsparen” and “Zinspilot” with comparatively high interest rates, with which business of the British-Australian parent company Greensill Capital was secured.

In 2019 alone, the bank's total assets rose from 760 million euros to 3.8 billion euros.

At the end of 2020 it amounted to 4.5 billion euros.

Parent company Greensill Capital filed for bankruptcy a few days ago after insurances for their funds were discontinued.

Icon: The mirror

fdi / Reuters

Source: spiegel

All business articles on 2021-03-16

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