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€35.2m being claimed by Nemea Bank depositors after licence suspended

85 per cent already paid by Depositor Compensation Scheme

The Depositor Compensation Scheme has already compensated 85 per cent of Nemea Bank’s 1,632 depositors, with a total of €35.2 million being claimed from the bank, whose licence was suspended in early April.

Although the bank’s owners still intend to appeal the suspension, the locally run scheme has already started paying out, with depositors eligible to receive up to €100,000 each.

According to the audited financial statements for 2015, the scheme had financial assets of €35.4 million, plus assets pledged by the Maltese banks in its favour of €89.3 million – meaning it has €124.7 million in total at its disposal.

The administrators for the scheme told the Times of Malta that as an online banking institution, Nemea Bank had to advise it of an alternative deposit account designated by each of its customers with another bank.

“This has generally made it possible for the scheme to settle claims by Sepa transfer directly into these alternative bank deposit accounts of customers,” a spokesman for the scheme said.

“We have identified 160 customers with claims from a few cents to under €10 who have not designated an alternative deposit account,” he added.

“We have already requested these customers to provide us with details of their designated alternative account to enable us to proceed with the relative payment.”

As soon as the scheme has paid out, it automatically becomes entitled to recoup the amount of compensation paid – once the bank is liquidated.

According to unaudited accounts, the online bank had assets of €68 million as at March 2016 and owed €61 million to its customers, most of whom reside overseas.

The bank’s owners have repeatedly told this newspaper that there were enough assets to cover the liabilities, with €8-9 million to spare – meaning the scheme would be able to recoup all the money it had paid depositors.

The Malta Financial Services Authority first highlighted that there were regulatory shortcomings at the bank last year.

The MFSA appointed Pricewaterhouse-Coopers in April 2016 as the “competent person” to take charge of the assets of the bank to “safeguard the interests of depositors and its other clients” and to assume control of the bank’s business.

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