BNP Paribas loses Swiss franc loan case in France’s highest court
Mortgages
51 minutes ago
Bank failed to provide sufficient information to customers about Swiss franc mortgages marketed between 2008 and 2009, court heard
Bank failed to provide sufficient information to customers about Swiss franc mortgages marketed between 2008 and 2009, court heard
French bank BNP Paribas is headquartered in Paris, but also has a branch in Luxembourg
Photo credit: Shutterstock
BNP Paribas’ personal finance unit has lost a case in France’s highest court in its dispute over Swiss franc mortgages marketed between 2008 and 2009.
France Court of Cassation said the bank had not given enough information to its customers about the mechanism of the loans, according to the ruling released Wednesday that partially reversed an earlier decision. The loans, denominated in Swiss francs but repayable in euros, saw their repayments explode when the Swiss currency became a safe haven after the 2008 financial crisis.
The Paris-based bank has faced a number of adverse rulings related to loans, known as “Helvet Immo”, sold to around 4,600 customers worth 800 million euros.
Last year, the EU Court of Justice ruled that banks cannot bind consumers to strict repayment limits for foreign currency loans that include unfair terms. In 2020, the lender was ordered to pay 127 million euros to its customers after being indicted in France for deceptive commercial practices.
“We take note of the decisions,” said a spokeswoman for BNP Paribas Personal Finance. “It is up to the referring courts to apply them in the various cases they deal with.”
Wednesday’s decision said customer complaints were not subject to a statute of limitations, allowing other loan takers to take their individual cases to French courts.
About 2,600 affected loan takers are suing the bank over those loans, Charles Constantin-Vallet, an attorney for the victims, told Bloomberg. BNP Paribas could eventually have to pay them around 250 million euros in compensation, although the total compensation could be much higher if other victims decide to go to court, he said.
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