Editions:  Austria · Denmark · France · Germany · Italy · Norway · Spain · Sweden · Switzerland

Swiss bank opposes ruling in housing case

Share this article

Swiss bank opposes ruling in housing case
Photo: Emmanuel Dunand/AFP
08:47 CEST+02:00
Swiss banking giant Credit Suisse on Monday challenged a court ruling ordering it to pay a US hedge fund $287.5 million (257.6 million euros) in a case linked to the burst housing bubble.

A court in the US state of Texas ruled last week in favour of a unit of Highland Capital Management in a suit against the bank for an overvalued real estate project called Lake Las Vegas, which the hedge fund unit invested in in 2007.
   
A year later, the planned Nevada resort community filed for bankruptcy as the subprime crisis erupted.
   
A Dallas judge ordered Credit Suisse to pay $211.9 million in damages and restitution and $75.6 million in prejudgement damages and interest, following a jury ruling last year finding Switzerland's second largest bank had inflated appraisals on development projects.
   
"We respectfully disagree with the court's decision," the bank told AFP in an email, adding that it planned to "pursue all available options" to oppose the ruling.
   
In its second quarter earnings report, Credit Suisse said it had put aside 124 million Swiss francs ($127 million) to cover legal expenses.
   
It said in that earnings report that it did not expect the Highland Capital Management lawsuit to have a significant impact on its results, although it acknowledged that the final costs could be higher than expected.
   
In February, the bank was forced to adjust its earnings for the fourth quarter of 2014 after adding an extra 277 million Swiss francs to its provisions linked ongoing legal settlements in the United States.

Get notified about breaking news on The Local

Share this article

From our sponsors

This small Mediterranean capital is the perfect winter city break

Valletta, Malta's small but mighty capital, still feels like one of the Med's undiscovered gems. But it won't stay that way for long. The Local's commercial editor, Sophie Miskiw, explored 2018's Capital of Culture and can't wait to go back.