The UK’s highest court today ruled that claimants against the main European arm of Lehman Brothers should receive at least £5bn in interest payments.
All original claims, totalling around £36bn, have been paid out by Lehman Brothers administrator PwC.
The Supreme Court today said that the creditors, largely made up of hedge funds, should receive additional statutory interest at a rate of eight per cent, equalling £5bn.
The money will come from a surplus of around £7.5bn which has been built up by Lehman Brothers International Europe (LBIE).
The court also today dismissed a separate currency conversion claim worth around £2bn, which would also have come from the surplus pot.
Lehman Brothers collapsed in 2008 when it suffered due to a lack of liquidity. However, its European operations were well capitalised, and so it has been able to settle all claims.
“Having already returned more than £36bn of cash and securities to customers of Lehman Brothers International Europe, including repaying all creditors in full, we have worked hard to find a way to distribute the remaining £7.5bn of surplus,” said PwC’s lead administrator Tony Lomas.
“However, there have been delays caused by a variety of legal proceedings involving creditor groups and shareholders asserting different entitlements. The first of these proceedings has come to an end today with the Supreme Court handing down its judgement on a set of matters known as ‘Waterfall I’.
“We are continuously focussed on resolving these issues to allow us to distribute the £7.5bn surplus, so we welcome the Waterfall I Supreme Court judgement.”