CONFIDENTIAL UK COMMS ONLY
142200 MDHOAN36
WOULD BE BETTER SERVED BY KEEPING ALIVE THE POSSIBILITY OF A
RESTRUCTURING AND RULED ACCORDINGLY.
DETAIL
3
LAST WEEK, THE VICE CHANCELLOR HAD ASKED FOR THREE ISSUES TO BE ADDRESSED BEFORE HE WOULD CONSIDER SUCH AN ADJOURNMENT. THESE WERE: FOR THE JOINT PROVISIONAL LIQUIDATORS AND THE LUXEMBOURG COMMISSAIRE TO BE GIVEN ACCESS TO THE DOCUMENTS IN ABU DHABI: FOR THE POSITION OF EMPLOYEES IN THE UK TO BE SUITABLY ADDRESSED: AND FOR THE POSITION OF STERLING DEPOSITORS WITH ACCOUNTS IN THE UK TO BE SUITABLY ADDRESSED. HE SAID HE WAS SATISFIED THAT EACH OF THESE HAD BEEN SUFFICIENTLY MET. HE UNDERSTOOD THAT SOME PROGRESS HAD BEEN MADE ON THE QUESTION OF ACCESS TO DOCUMENTS AND SCHEMES WERE PROPOSED IN COURT TO ADDRESS THE OTHER TWO POINTS:
(A) DEPOSITORS
UNDER THEIR SCHEME FOR DEPOSITORS, THE MAJORITY SHAREHOLDERS WILL PLACE 43 MILLION POUNDS STERLING WITH THE LAW DEBENTURE TRUST, WHICH WILL PAY OUT 75 PER CENT
OF ALL STERLING DEPOSITS IN THE UK, UP TO
A MAXIMUM PAYMENT OF FIVE THOUSAND POUNDS STERLING PER PERSON. THIS PAYMENT WOULD BE MADE IN THE FORM OF A LOAN, TO BE RECOVERED FROM THE UK DEPOSIT PROTECTION BOARD (DPB) IN THE EVENT THAT A WINDING-UP ORDER IS MADE, OR FROM THE RESTRUCTURED BCCI IF IT IS NOT MADE. THE SCHEME WILL BE ADMINISTERED BY THE JOINT PROVISIONAL LIQUIDATORS. THIS SCHEME WILL GIVE EQUIVALENT TREATMENT TO THE DPF FOR APPROXIMATELY 45,000 OF THE 54,000 ELIGIBLE FOR COMPENSATION. SOME 9,000 WILL RECEIVE ONLY FIVE THOUSAND POUNDS STERLING RATHER THAN UPTO THE FIFTEEN THOUSAND POUNDS STERLING TO WHICH THEY ARE ENTITLED BY STATUTE.
THOSE WITH DEPOSITS IN THE UK BRANCHES WISHING TO APPLY FOR THIS COMPENSATION SHOULD APPROACH THE PROVISIONAL LIQUIDATOR (TELEPHONE NUMBER 071 480 7766). IN THE MEANTIME, THE CLAIM FORMS SENT TO DEPOSITORS ON MONDAY 22 JULY SHOULD STILL BE COMPLETED AND RETURNED TO THE DPB, AGAINST THE POSSIBILITY THAT A CLAIM ON THE FUND MAY BE MADE AT SOME FUTURE TIME. B) EMPLOYEES
THE MAJORITY SHAREHOLDERS' PROPOSALS TO PROTECT BCCI EMPLOYEES INVOLVE AN INITIAL 1.2 MILLION POUNDS STERLING PAYMENT FROM THE MAJORITY SHAREHOLDERS TO THE PROVISIONAL LIQUIDATORS, WHICH