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Credit Suisse files lawsuits against Australia’s IAG over Greensill collapse

Randy Mancini 6 Mar 2
FILE PHOTO: Logo of Credit Suisse is seen in Zurich, Switzerland
FILE PHOTO: The logo of Swiss bank Credit Suisse is seen at an office building in Zurich, Switzerland February 21, 2022. REUTERS/Arnd Wiegmann

March 3, 2022

By Byron Kaye

SYDNEY (Reuters) – Credit Suisse Group AG joined creditors of Greensill Capital by filing lawsuits in Australia seeking compensation from the country’s biggest insurer over the supply chain financier’s collapse, court filings showed.

Local media put the total claims at A$300 million ($219 million).

Insurance Australia Group Ltd (IAG) was previously named as potentially exposed to the 2021 failure of Greensill since its former unit BCC Trade Credit sold policies to Greensill, but said at the time it had no liability because it sold its share of the unit two years earlier.

But lawsuits have been mounting against the Australian company, which is best known at home for selling property and car insurance.

Greensill’s administrator and U.S. private lender White Oak Global Advisors, which is working with Greensill client GFG Alliance, each filed suit against IAG in late 2021, court filings show.

Credit Suisse then filed two lawsuits against IAG last month, filings show. All four lawsuits were joined together and had their first administrative hearing in the Federal Court on Thursday, court filings showed.

The Australian Financial Review reported that the total claimed by the companies was nearly A$300 million, about half of which was by White Oak. White Oak did not respond to Reuters emails seeking comment.

Credit Suisse was not immediately available for comment. Switzerland’s second-largest bank played a pivotal role in Greensill’s collapse by suspending $10 billion of supply chain funds soon before Greensill filed for insolvency.

An IAG spokesperson said the company continued to believe it was not liable for BCC policies, that it “anticipated potential litigation by the administrators of Greensill or other claimants” and would defend the lawsuits.

($1 = 1.3721 Australian dollars)

(Reporting by Byron Kaye; Editing by Kim Coghill)