(News Bulletin 247) – KBC announced on Friday evening that it had taken note of an arbitration award in the amount of 3.7 billion Czech crowns (156 million euros) in the context of a dispute in the Czech Republic.
The arbitration procedure concerned CSOB, the Czech subsidiary of the Belgian financial group, which was being sued as the buyer of Investicni a postovni banka (IPB), an establishment acquired in 2000.
The procedure opposed it since 2007 to ICEC-Holding, according to which IPB had breached its contractual obligations in 1999, which entitled it to damages and interest and a contractual penalty.
In the arbitration award, CSOB will also have to pay procedural costs amounting to five million crowns, within a period of fifteen days from the delivery of the award.
ICEC-Holding failed in the rest of its claim and an arbitration panel ordered it to reimburse CSOB for the costs of the proceedings in the amount of 17.4 million crowns.
The payment of damages and contractual penalties will have a negative financial impact on the accounts of CSOB and the KBC group, amounting to 149 million euros before tax, or 121 million euros after tax.
KBC said in a press release that its subsidiary concerned, CSOB, intends to examine possible legal steps with a view to revising the award.
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