Totta continues to study acting in the case of “swaps” sold to private companies – Jornal de Negócios – Portugal

Totta continues to study acting in the case of “swaps” sold to private companies

The bank has not decided whether to ask for a uniformity of jurisprudence in decisions on “swaps” sold to consumers and businesses – this option so you can be favorable as unfavorable.

Santander Totta has not yet decided on what it will do for the various cases around contracts “swaps” marketed to clients and private companies that have generated and decisions court reversed.

“The matter is still being studied by lawyers,” said António Vieira Monteiro, when asked about the intention to come to ask for a “unification of jurisprudence”, which in practice would make decisions around this theme were always in one direction:. either for or against the bank

The Supreme Court has ruled on four decisions, two favorable to private companies, two to the bank . In the lower courts, both in the ratio as in the first instance, decisions have also pointed to several ways:. One accept the argument that “swaps” are a game of chance and luck, others refuse

The “swap” contracts are financial risk management tools, which are based on the perspective of protecting certain loan growth rates, including interest rates or exchange. In some cases, these “swaps” have led to heavy losses in the portfolios of the companies given the wide variation in interest rates.

Besides selling to small private companies, Santander also marketed these products management of financial risk to public companies, such as Metro Lisbon, Oporto Metro, Carris and STCP. The parliamentary commission of inquiry found that these instruments were signed several products from public enterprises to favor short-term results at the expense of uncertain costs in the future – the agreements reached in 2012, representing potential losses of more than 3 billion euros.

In these cases, Santander was the only one with the Portuguese State did not agree to cancel the “swaps” since rejected the idea that had sold speculative products. So, in anticipation, the bank has chosen to put the companies in court in London to determine the validity of “swaps” – the bank has needless to reveal which court in which the proceedings were placed. The trial is expected to last quarter, said António Vieira Monteiro.

Santander did not put money aside for losses on “swaps”

However, Santander Totta not expect to face losses on lawsuits that are running in England to enact the validity of “ swap ” which sold to public companies in the past decade.

“It is conviction of the bank’s board of directors, supported by the opinion of its legal advisors English and Portuguese, which are all the conditions for the court to act on its claims, including declaring the validity of the aforementioned contracts and notifying the public sector companies to liquidate the interest associated with them, “said the report and accounts relative to 2014 the bank chaired by António Vieira Monteiro.

This is why “we have made no provision in the financial statements to cover a possible unfavorable outcome of those actions.”

At the end of 2014, “ swap ” had a negative market value for companies of 1.32 billion euros, compared to 1 030 million a year earlier. Since September 2013 that companies like Lisbon and Oporto Metro do not pay the interest associated with the contracts -. 134 million euros, according to the bank

In addition to Totta contracts, other derivatives subscribed by public companies that have not been canceled, because they are simple and are making the protection from the change in interest rates. Have a negative market value of 506.6 million euros at the end of last year, according to the Directorate General of Treasury and Finance.