OREANDA-NEWS.  October 01, 2013. In the first year after the meeting of creditors of Snoras bank, which is being wound up, the bankruptcy administrator’s team realised LTL 530 million from the bank’s assets.

The total value of recovered assets is LTL 1.66 billion and these funds are available to be paid out to Snoras creditors, says the Annual Report of bankruptcy administrator Neil Cooper for the period to 30 June 2013.

The bankruptcy administrator successfully sold the network of Snoras minibanks, which realised LTL 3.1 million. Since the period end, a sale of the bank’s subsidiary Snoro Lizingas and its loan portfolio completed, realising LTL 74 million. An agreement has also been reached for the sale of Snoras Media shares and the deal will be completed once certain conditions have been met, including securing the approval of the Competition Council.

Following the approval of the Creditors’ Committee, the process of selling real estate previously owned by the bank and foreclosed, which is valued at LTL 185 million, began and negotiations are continuing with potential buyers of Finasta bank.

The Bankruptcy Administrator, Neil Cooper, commented that “I believe that we have made excellent progress in the Bankruptcy during this period. Considering the complexity of the situation, the international spread of assets and the extensive network of transactions put in place by the former shareholders to divert funds from the Bank, we have recovered a substantial amount of funds for creditors. I also remain confident that our continued efforts will result in further significant recoveries in the future.”

According to Mr Cooper, current outstanding legal claims of LTL 2.4 billion are being pursued in order to seek to recover funds and assets of the bank from its former shareholders and related persons and funds. These recovery actions remain supported by a worldwide freezing order to a value of LTL 1.7 billion, which was previously secured by the Bankruptcy Administrator against the assets of one of the former Snoras shareholders.

The Administrator’s team also managed to investigate and unravel a structure of  asset transfers in which loans with a realisable value of LTL 180 million were transferred to funds registered in the Cayman and British Virgin Islands. By the middle of the year, the loans had been transferred back to Snoras and LTL 73 million had been recovered for Snoras creditors; and further funds continue to be recovered by the Bankruptcy Administrator.

The proceedings against Julius Baer bank continue in Switzerland to seek to recover LTL 829 million of misappropriated assets from Snoras.

The Bankruptcy Administrator’s team has continued active monitoring of the bank’s loan portfolio. Since the start of bankruptcy, LTL 876 million in outstanding loans and interest has been repaid, including LTL 371.8 million in the period concerned.

In total, creditors have filed over 28,500 claims against the bankrupt bank and as at 30 June 2013 the court had approved 17,167 of them. The total amount of funds claimed is LTL 6.7 billion. By the end of the first half of this year, first-rank creditors (employees of the Bank) have been paid LTL 9.3 million. Funds are available for payments to second-rank creditors but payments can only start after completion of legal proceedings instigated by certain creditors contesting the ranking of creditor claims.

Since the declaration of bankruptcy, the Administrator has continued to reduce the number of bank staff from 1,385 to 139 in several phases. All non-essential services have been reviewed in order to minimise the winding-up costs.

The total costs of running the bankrupt bank made up LTL 35.05 million in the period concerned. These costs reduced by over 40% in the period from LTL 10.95 million between July and September 2012 to LTL 6.41 million in the second quarter of this year. Total annual costs, including all operational and professional costs, stood at approximately LTL 124 million.

The sale of real estate owned by Snoras and certain foreclosed assets taken over will continue: auctions will be held for properties worth less than LTL 1 million and the sale of properties valued above this threshold, including real estate abroad, will start after the completion of appraisal procedures and the required approvals are obtained from the creditors’ committee. Movable property of the bank continues to be offered for sale at weekly public auctions and further details of these can be found on Snoras’ website.