The Dubai financial regulator has called for the winding-up of the local unit of troubled Portuguese bank Espirito Santo after its manager attested that it was unable to continue as a going concern.
The DIFC Courts have appointed administration specialists Philip Bowers and Neville Kahn of Deloitte as joint provisional liquidators of ES Bankers (Dubai) Ltd (ESBD), following a petition made on September 24 by the freezone’s regulator the Dubai Financial Services Authority (DFSA).
“The primary function of the joint provisional liquidators is to protect ESBD’s assets and those of its clients in the period until a formal winding-up hearing,” said the regulator in a statement.
A hearing of the DFSA’s petition will be heard in the DIFC Courts on October 19, at which point it will be decided whether to place the bank into full liquidation, and to formalise the liquidators’ appointments.
Mr Bowers said in a statement that ESBD’s financial position was currently being reviewed, and that he and Mr Kahn could not currently comment “on the potential quantum of return to depositors”.
“A liquidator (if appointed) will write to clients with Customer Deposits separately in due course to agree claims and to advise on the likely timing and quantum of payments,” he said.
In April, Mr Bowers and Mr Kahn were appointed as joint receivers of London’s iconic Gherkin tower, after a series of loan defaults on the building.
The petition follows a restriction placed by the regulator on ESBD on September 18 from taking or paying deposits and to require the firm to maintain and preserve its assets.
The restriction was put in place after Banque Privee Espirito Santo (BPES), a Swiss-domiciled entity in the same group as ESBD, to honour contractual commitments to the Dubai-based entity and to repay deposits owed to it.
BPES is currently subject to liquidation proceedings in Switzerland, with several other members of the Espirito Santo Group also in some form of external administration.
Portuguese regulators bailed out the financial group - splitting the bank in two - in August after Banco Espirito Santo’s owners were unable to meet commitments on billions of euros of debt.
jeverington@thenational.ae
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