Friday, October 29, 2010

Awal Bank Chapter 11 Filing - Statement on Behalf of Charles Russell

In response to my request I received the following from Alisdair Haythornthwaite at Bell Pottinger Middle East (UAE).   BPME is a division of Chime Communications, a leading UK public relations firm (among other things).

Awal Bank BSC Chapter 11 Case Update

U.S. Court Delays Consideration of Awal Bank’s Proposed Chapter 11 Protocol

Bahrain, October 27, 2010:  Charles Russell LLP, acting as External Administrator and Foreign Representative (the “Foreign Representative”) of and for Awal Bank BSC (“Awal Bank”) attended a “first day” hearing on October 26, 2010.

At the hearing, the Bankruptcy Court considered the Foreign Representative’s Motion for Entry of an Order Establishing Protocol for Chapter 11 (the “Motion”).  After hearing from both the Office of the United States Trustee and counsel for the Foreign Representative, the Bankruptcy Court directed that the Motion be further considered at a later date after giving opportunity for creditors to make representations regarding the relief requested in the Motion.

The U.S. based legal activities form part of a multinational litigation process, with court proceedings also currently underway in Bahrain, the Cayman Islands, the Kingdom of Saudi Arabia, Switzerland and the United Kingdom. It is therefore necessary that any Protocol established in the U.S. works alongside the work being undertaken in Bahrain. In this regard the Foreign Representative is considering whether to further pursue the relief requested in the Motion.

In October 2009 the Foreign Representative obtained “foreign main proceeding” recognition from the Bankruptcy Court under Chapter 15 of the U.S. Bankruptcy Code for Awal Bank’s administration proceedings in Bahrain. The Bahraini administration governed by the Central Bank of Bahrain and Financial Institutions Law (“CBBFIL”), continues to be recognised as the foreign main proceeding under Chapter 15.
I'll keep monitoring the Bankruptcy Court of the Southern District of New York for electronic filings on the case to see if there is anything on the Court's reasoning for its decision. 

1 comment:

Anonymous said...

Until the AWAL and TIBC cases are resolved and transparency restored .The lack of action by local regulators will continue to hold the region back inspite of its wealth.