Cypriot firm appeals against recovery of $30.5 mln in favor of Trust Bank
MOSCOW, April 21 (RAPSI) – Cyprus-based TIB Investments Limited has appealed against a court ruling ordering it to pay 1,996 billion rubles (about $30.5 mln) in favor of Trust Bank, according to court records.
Yet in March, the court fully complied with the Trust Bank’s demand to recover the amount of the claim. At the same time, the court dismissed a counterclaim put forward by the foreign company, which sought to declare four deliverable forward contracts, subject to the bank’s monetary claim, void due to the allegedly fictitious nature of the transaction.
According to the court papers, National Bank Trust petitioned to recover the amount of exchange difference with regard to forward contracts signed on June 23, 2009, as part of a general agreement on lending and foreign exchange transactions.
Under these forward contracts, in 2009 and 2010 the bank transferred ruble-denominated funds to its “sister” (as defined by the court) affiliated company TIB Investments Limited to purchase dollars. The deal envisaged the delivery of purchased amounts of foreign currency in 2011 to 2016; however, the transaction had not been carried through.
The claimant’s counsel maintained that these transactions were to disadvantage to the bank, since dollars were being bought at 35 rubles, whereas dollar market price was at 29 rubles. The former management of the bank, affiliated, according to the counsel, with the Cyprus-based company, was aware of this fact.
In his turn, the representative of the Cypriot firm stated that the transactions he petitioned to declare void on the grounds of their fictitious nature resulted from an agreement between parties not to carry the deal through and that no movement of funds had ever occurred under these contracts.
As reported earlier, in another lawsuit the court ruled that the deals made between the bank and TIB Investments Limited on June 23, 2009, were fictitious and “aimed at the transfer of unrealized profits derived under TRS transactions to the sister company located in a low-tax jurisdiction.”
The court upheld the bank’s claim pointing out that the terms of forward contracts envisaged not only delivery of dollars on the part of defendant, but also delivery of rubles on the part of claimant on certain dates of currency valuation. Thus, the claimant was obliged to pay the defendant 2.39 bln rubles, whereas the defendant was obliged to pay the claimant $71,508 mln. As on March 19, 2015 (the date the defendant received notification), the exchange ruble/dollar rate was at 61.3483.
Applying this exchange rate to the defendant’s liabilities, the amount thereof made 4.387 bln rubles, and, therefore, the difference was at 1.996 bln rubles.
As concerned the counterclaim put forward by the foreign company, the court pointed out that the defendant could not contest some transactions as these moves were barred by the statute of limitations. The court dismissed the defendant’s arguments with regard to the fictitious nature of transactions. The court also noted that the ruling in another lawsuit could not prejudice this case as the Cypriot company had not participated in a tax dispute between the bank and a tax inspection office.
For the first half of 2015, Trust bank filed about 20 lawsuits against companies registered in the offshore jurisdictions worth over 32 billion rubles ($464.5 mln) and over $94 million. Business media outlets reported that some of these companies were associated with the former owners of the bank.
Midsized lender Trust Bank reported losses of 18.8 billion rubles (about $273 mln) in 2014 amid the financial crisis. As of December 1, 2014, its assets were estimated at over 290 billion rubles ($4.2 bln).
The Central Bank estimated that the bank’s debts exceeded the value of its assets by 67.8 billion rubles ($984 mln).
In late December 2014, the Central Bank of Russia decided to reorganize Trust Bank, which at that time was on the list of the top 30 Russian banks, placing it under the temporary supervision of the Deposit Insurance Agency. FC Otkrytie Bank, part of Otkritie Holding, was selected as a bridge bank.