Carnegie demands 8.4 billion kronor from state
The former owners of Carnegie Investment Bank are suing the Swedish state for 8.4 billion kronor ($1.1 billion) over the enforced takeover of the bank during the financial crisis in 2008.
Holding company D. Carnegie & Co is demanding compensation for shares in Carnegie and Max Matthiessen, which the the National Debt Office (Riksgäld) took over in November 2008. The takeover was made under laws to safeguard the stability of the financial sector.
This is the second time that D. Carnegie has attempted to gain compensation.
"D. Carnegie & Co's new petition does not represent anything new," Riksgäld director Bo Lundgren said in a statement. "Without state aid, Carnegie would have gone bankrupt and would have threatened financial stability during the financial crisis."
In the fall of 2008, Carnegie could not longer secure loans from the financial markets and was forced to seek emergency loans from Sweden's central bank, the Riksbank. The bank's situation was compounded when the Financial Supervisory Authority (Finaninspektion, FI) withdrew its banking license.
In order to protect lenders and avoid further disruption to the financial sector, the Riksgäld reached an agreement with D. Carnegie if it could no longer finance itself and took over ownership of Carnegie and Max Matthiessen.
In a previous process that is still ongoing, Carnegie requested that the valuation of the agreement between the parties be examined. At the same time, it is now suggesting that the agreement is invalid.
The law says that the valuation of a bank that cannot manage without state support should be treated as if there were no state aid.
Last week, the European Commission gave its final approval to the Riksgäld's restructuring and sale of Carnegie Investment Bank and Max Mathiessen.
The first preliminary hearing will be held in court between Carnegie and the state at Stockholm District Court on Monday.
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Holding company D. Carnegie & Co is demanding compensation for shares in Carnegie and Max Matthiessen, which the the National Debt Office (Riksgäld) took over in November 2008. The takeover was made under laws to safeguard the stability of the financial sector.
This is the second time that D. Carnegie has attempted to gain compensation.
"D. Carnegie & Co's new petition does not represent anything new," Riksgäld director Bo Lundgren said in a statement. "Without state aid, Carnegie would have gone bankrupt and would have threatened financial stability during the financial crisis."
In the fall of 2008, Carnegie could not longer secure loans from the financial markets and was forced to seek emergency loans from Sweden's central bank, the Riksbank. The bank's situation was compounded when the Financial Supervisory Authority (Finaninspektion, FI) withdrew its banking license.
In order to protect lenders and avoid further disruption to the financial sector, the Riksgäld reached an agreement with D. Carnegie if it could no longer finance itself and took over ownership of Carnegie and Max Matthiessen.
In a previous process that is still ongoing, Carnegie requested that the valuation of the agreement between the parties be examined. At the same time, it is now suggesting that the agreement is invalid.
The law says that the valuation of a bank that cannot manage without state support should be treated as if there were no state aid.
Last week, the European Commission gave its final approval to the Riksgäld's restructuring and sale of Carnegie Investment Bank and Max Mathiessen.
The first preliminary hearing will be held in court between Carnegie and the state at Stockholm District Court on Monday.
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