The construction giant successfully won a court dispute with Bank Millennium, concerning the loss on currency options. ERBUD is to receive from the bank about PLN 100 million with interest. The judgment is legally binding.
The decision of the Court of Appeal in Warsaw concerns the compensation of damage, which consisted of amounts drawn by the bank from the company’s bank account, lost profits, and costs of legal and financial advisers. The value of the dispute was PLN 71.1 million. The Court of Appeal upheld ERBUD’s appeal in part, awarding Bank Millennium the sum of PLN 51.4 million, plus statutory interest.
- The proceedings lasted over 10 years, they were extremely complicated; the mathematical calculations alone covered several hundred pages. The court had no doubts that we were right, which is a source of great satisfaction for me – comments Agnieszka Głowacka, Vice-President of ERBUD.
The judgment stems from a dispute between ERBUD and Bank Millennium. The case concerned the conclusion in 2008 of currency option transactions to hedge against exchange rate risk in the scope of contracts denominated in EUR. According to ERBUD, the product was not optimally suited to the Company’s specific requirements.
In Q4 2008, as a result of the drastic depreciation of the Polish zloty against the PLN/EUR pair, the Bank informed the Company of the negative valuation of its exposure at that time. ERBUD would like to remind that the loss incurred in connection with the conclusion of currency option transactions to hedge the exchange rate risk on EUR-denominated contracts was settled in 2008.