26
Sun, Jun
49 New Articles

Recent Legal Developments in the Liquidation of Sberbank Hungary

Recent Legal Developments in the Liquidation of Sberbank Hungary

Hungary
Tools
Typography
  • Smaller Small Medium Big Bigger
  • Default Helvetica Segoe Georgia Times

The Hungarian Government issued a decree that amends certain provisions of the bank's liquidation proceedings.  The decree entered into force on 15 April, and it affects the solvent liquidation of Sberbank Hungary, subsidiary of Sberbank Europe AG, Hungarian member of the Russian Sberbank group. 

Even though it affects the liquidation of Sberbank Hungary, the decree covers every credit institution incorporated in Hungary; and it affects both solvent and insolvent liquidations thereof. The decree is issued under the umbrella of the Act I of 2021 on the Protective Measures in Relation of the Covid Pandemia which enables the Hungarian government to amend certain Parliament acts by way of an interim government decree. The decree thus will remain in force only until the Act is in force. Nevertheless, it will remain applicable even thereafter for the then ongoing procedures.

The measures affecting the ranking of claims in a solvent liquidation:

  • The administrator must release from the bankruptcy estate the amounts on the deposit accounts of notaries, bailiffs and law firms and any deposits with the purpose of securing third party obligations. The purpose of this provision should be welcome as the transactions that are affected by a banking liquidation (the liquidation of Sberbank Hungary in the present) may go forward and will not get stuck until the liquidation is completed.
  • After the above release the administrator must settle the claims of the deposits of private clients and SMEs to the extent such claims were not settled by the National Deposit Insurance Fund (Országos Betétbiztosítási Alap - OBA).
  • The remaining claims must be settled according to the statutory ranking.

As to the ranking of claims in an insolvent liquidation, the release of deposit accounts and security deposits applies mutatis mutandis. However, the deposit claims of private and SME clients will not become super-senior.

Also, it is required in an insolvent liquidation; provided that a solvent liquidation turned to an insolvent one, that the creditors must submit their claims within 30 days from opening the insolvent liquidation proceeding (the general rule is 60 days).  Irrespective if the insolvent liquidation was preceded by an insolvent liquidation or not, security deposits securing third party claims must be enforced within 60 days from the opening of the proceeding (the general rule is 3 months).

Both in case of solvent and insolvent liquidation, it is also set forth that the administrator must attempt to sell the portfolio of the liquidated bank as a going concern and apply for the relevant approval at the Hungarian National Bank within 120 days from the start of the proceeding (this deadline may be extended though).

By Gergely Szaloki, Partner, Schoenherr

Schoenherr at a Glance

Schoenherr is a leading full-service law firm providing local and international companies stellar advice that is straight to the point. With 15 offices and 4 country desks Schoenherr has a firm footprint in Central and Eastern Europe. Our lawyers are recognised leaders in their specialised areas and have a track record of getting deals done with a can-do, solution-oriented approach. Quality, flexibility, innovation and practical problem-solving in complex commercial mandates are at the core of our philosophy.

Firm's website: www.schoenherr.eu