Russian oil pipeline company Transneft managed to secure an arbitration court decision invalidating its 2014 interest-rate-swap transaction with PAO Sberbank of Russia as the result of which it incurred losses exceeding 66 billion Russian rubles, Vedomosti reported June 9.
Transnet concluded the derivative agreement in order to hedge its foreign-currency debt and funds from currency risks. The company said it was approached by Sberbank to sign the contract and that the lender failed to inform it properly about all risks associated with the deal.
A Sberbank representative reportedly said the bank is surprised by the court ruling and intends to appeal after receiving the full text of the decision.
If upheld by the court of the second instance, the ruling could set a legal precedent for companies looking to contest similar deals, negatively affecting the Russian derivative market or forcing its participants to move to offshore jurisdictions, Vedomosti said, citing local market analysts.
As of June 8, US$1 was equivalent to 56.95 Russian rubles.