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Court to consider BCCI deal

John Willcock
Tuesday 18 April 1995 18:02 EDT
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A Luxembourg court will consider on 28 April approving a $425m settlement between liquidators of Bank of Credit and Commerce International and the National Commercial Bank of Saudi Arabia, according to sources close to the liquidators, writes John Willcock.

If the deal goes ahead it will join the other big out-of-court settlement - the $1.8bn compensation package for customers - following the 1991 closure of BCCI after years of multi-million dollar fraud.

The compensation deal, partly funded by BCCI's majority shareholder Abu Dhabi, gained court clearance on 31 January. The Saudi deal with NCB, its former chief operating officer, Sheikh Khalid bin Mahfouz, and an associate, the Pakistani banker Haroon Khalon, would settle allegations that they were involved in covering up the BCCI scandal.

The defendants have agreed to pay into the settlement without admitting liability and to drop counter claims against BCCI.

The liquidators would then drop a $10.5bn lawsuit filed earlier against Sheikh Mahfouz and NCB, a former customer and investor in BCCI.

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