The case of Austrian entrepreneur René Benko plunged the traditional bank into crisis. Now, at least the loan loss could be slightly reduced.
Bank Julius Baer might achieve an extraordinary gain of 100 million francs from the Signa bankruptcy – in other words, it may reduce its loan loss from 600 Swiss francs ($706 million) to 500 million francs, according to a report by «Handelszeitung».
The reason for this is that a portion of the controversial loans extended by Julius Baer to René Benko appears to be more valuable than feared.
Two Loan Tranches Are Lost
Julius Baer had granted the Signa empire of Benko three loans of 200 million francs each. Nothing can be recovered from two of the loans, as they were secured by guarantees from the Signa empire. The third tranche was granted by Julius Baer to Benko for the purchase of the Globus Group and secured by shares of Globus AG, which, according to the «Handelszeitung,» can be realized.
Julius Baer is expected to receive 100 million francs; the other half of the share package will reportedly be taken over by the Thai Central Group.
The bank declined to comment on the report.
