HSH Nordbank AG is facing a €1.4 billion lawsuit alleging that the German lender improperly reduced the book value of securities issued between 2002 and 2005, the Financial Times reported.
A group of 18 bond investors lodged the complaint on Dec. 28, 2018, before the Kiel district court, according to the Jan. 7 report. The lawsuit involved securities with a nominal value of approximately €2 billion. The bank estimated that by 2020, the book value of the securities would be about 15% of the original nominal value, but it was 40% at the end of 2017, the FT noted.
The complainants, who make up about half of the affected bondholders according to a person familiar with the lawsuit, are demanding that the securities be revalued and that they be compensated for the interest payments they did not receive, the FT said.
The lender has yet to receive the lawsuit but believed that the allegations were baseless, according to the report.