Madison Pacific Trust Limited, a new trustee for PrivatBank’s $175 million loan participation notes maturing on Feb. 28, 2018, and $200 million loan participation notes maturing on Jan. 23, 2018, has announced that requests for arbitration were submitted to the London Court of International Arbitration on Nov. 8.
“On Nov. 8, 2017, the New Trustee and the Issuer submitted requests for arbitration to the London Court of International Arbitration and these requests have been served on PrivatBank. These requests are in relation to loan agreements between PrivatBank and the Issuer,” the issuer, UK SPV Credit Finance plc said in a statement on the London Stock Exchange’s website.
The new trustee will update noteholders on significant developments relating to the arbitration process, to the extent it is able to do so, it said.
As was reported, under the nationalization of PrivatBank, its obligations to the British-based special purpose vehicle (SPV) that was the issuer of LPNs were subject to a bail-in procedure and were exchanged for additionally issued shares of the bank.
The matter concerns three issues of LPNs: those worth $175 million at a rate of 10.875% repayable on Feb.28, 2018, $200 million at a 10.25% repayable on Jan. 23, 2018, of which $40 million was repaid in Aug. 2016, and $220 million at a rate of 11% with maturity in 2021.
The issuer of the LPNs falling due in Jan. and Feb.2018 was UK-registered UK SPV Credit Finance plc. The LPNs maturing in 2021 were issued via ICBC Standard Bank plc (the UK), however, during their restructuring, that debt was re-registered to UK SPV Credit Finance plc.
After PrivatBank was nationalized, the note issuer remained in its ownership.
Early October 2017, PrivatBank replaced the trustee for $175 million LPNs PrivatBank due on Feb.28, 2018 and $200 million LPN due on Jan. 23, 2018. From Oct. 3, 2017, Madison Pacific Trust Limited replaced Deutsche Trustee Company Limited (the UK).
The National Bank of Ukraine on October 27, 2017 approved the change of the structure of the PrivatBank banking group. SIA PrivatLizings (Latvia), PrivatOffice LLC (Dnipro), UK SPV Credit Finance plc and Ukraine Mortgage Loan Finance No.1 plc (the UK) were excluded.
Madison Pacific Trust Limited on Nov. 2 sent an acceleration notice to the bank, seeking to early collect the debt. PrivatBank is said to have 30 days to respond to the notice.
