Court awards Adollars 71.5m to Standard Chartered
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Your support makes all the difference.STANDARD Chartered Bank yesterday notched up a hat-trick in the courts with its third substantial award this year in litigation against customers and advisers in Australia and the United States.
The bank was awarded Adollars 71.5m ( pounds 30m) by the New South Wales supreme court against one of its Australian customers, GPI Leisure Corporation.
This brings the total of court awards to Standard Chartered in 1992 to pounds 263m. Although the full amount of the awards is unlikely to be paid over during 1992, the total is substantially ahead of Standard Chartered's last annual profits, of pounds 205m before tax in 1991.
Standard Chartered lent money to GPI in 1988, but since then has been suing to recover it. The bank has already made a provision against likely losses, so the award will be credited to profits in the 1992 accounts.
The biggest of the three court awards - for dollars 338m ( pounds 200m) against accountants Price Waterhouse - may still be appealed.
But even without it, Standard Chartered could still offset a substantial part of the potential loss of pounds 100m stemming from its involvement in the Bombay stock exchange scandal, for which it has announced a bad debt provision.
The three sets of profitable litigation are unrelated to the costly scandal but could substantially reduce and perhaps eliminate the damage to profits this year.
The award against Price Waterhouse was in the US courts. The bank sued over advice the firm gave during negotiation of the purchase of United Bank of Arizona in the early 1980s.
Standard Chartered lost heavily on the deal.
Price Waterhouse has been studying whether to appeal against the judgment but it is understood that negotiations on a phased payment are already under way.
Standard Chartered remains confident that it will be paid most of the sum awarded, but over a number of years. It is not clear whether initial payments are likely in time for this year's accounts.
Profits will also be boosted by an award of more than dollars 60m ( pounds 33m) against Coopers & Lybrand, the accountants, after a lawsuit over advice to the bank on the affairs of a US company called Miniscribe.
Some of the award has now been paid over, but Standard Chartered is still examining the best way to handle the money for tax efficiency so it is not yet clear how much of the windfall will appear in the 1992 profits.
The shares were unchanged last night at 467p, but most other bank shares showed significant losses.
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