Bulletin: EAA's Litigation Risk Decreases After Court Ruling; State of NRW Not Materially Affected

FRANKFURT (S&P Global Ratings) Dec. 22, 2022--S&P Global Ratings today said it considers litigation risk and risk to the capital base for Erste Abwicklungsanstalt (EAA; AA/Stable/A-1+) decreased with yesterday's decision by the Higher Regional Court (Oberlandesgericht [OLG] Frankfurt) to reject Portigon AG's (not rated) claims to reimburse it for tax expenditure of about €1 billion (including accrued interest) related to illegal dividend arbitrage (cum ex) transactions conducted by their common predecessor, Westdeutsche Landesbank (WestLB). With yesterday's decision, the OLG Frankfurt reversed a lower court's ruling in Portigon's favor. However, we understand that Portigon can still appeal to the German Federal Court of Justice. We also do not anticipate any rating impact for the State of North Rhine-Westphalia (NRW; AA/Stable/A-1+). We

...FRANKFURT (S&P Global Ratings) Dec. 22, 2022--S&P Global Ratings today said it considers litigation risk and risk to the capital base for Erste Abwicklungsanstalt (EAA; ##/Stable/A-1+) decreased with yesterday's decision by the Higher Regional Court (Oberlandesgericht [OLG] Frankfurt) to reject Portigon AG's (not rated) claims to reimburse it for tax expenditure of about 1 billion (including accrued interest) related to illegal dividend arbitrage (cum ex) transactions conducted by their common predecessor, Westdeutsche Landesbank (WestLB). With yesterday's decision, the OLG Frankfurt reversed a lower court's ruling in Portigon's favor. However, we understand that Portigon can still appeal to the German Federal Court of Justice. We also do not anticipate any rating impact for the State of North Rhine-Westphalia (NRW; ##/Stable/A-1+). We understand that EAA did not provision for this case after the first ruling, but even in the event of a final ruling not in its favor, we consider a negative...

Bulletin