May 31 An outline bond buyback deal between Austria and creditors of “bad bank” Heta Asset Resolution is unlikely to be jeopardised by a court case due to resume in Frankfurt next month, Finance Minister Hans Joerg Schelling said on Tuesday.
In March a regional court in Frankfurt delayed until June 9 a ruling in a case brought against a moratorium on Heta bond repayments, staving off the threat of immediate insolvency for Heta.
Despite the outline deal reached this month to buy back Heta bonds at a discount to their original face value, a financial source said that some creditors still hope to get back all their money through the case brought by FMS, a German equivalent of Heta.
“If I look at the latest developments in the courts, I think that is rather unlikely,” Schelling told reporters before a weekly cabinet meeting, referring to another case in which Austria’s bank resolution rules were referred to the European Court of Justice to see if they applied to Heta. (Reporting by Shadia Nasralla; Writing by Francois Murphy; Editing by Maria Sheahan)
