Home / Business and Economy / Trianon Fund Liquidation Hit by 38 Billion Won Lawsuit
Trianon Fund Liquidation Hit by 38 Billion Won Lawsuit
3 Feb
Summary
- Standard Chartered Bank seeks 38 billion won in hedging settlement payments.
- The Trianon Fund's liquidation is complicated by ongoing litigation.
- A Frankfurt office building serves as the Trianon Fund's underlying asset.
Standard Chartered Bank has initiated legal proceedings, seeking roughly 38 billion Korean won in hedging settlement payments from NH Bank and IGIS Asset Management. This lawsuit is occurring as the Trianon Fund, whose assets include the Trianon Building in Frankfurt, undergoes liquidation.
The Trianon Fund was established in 2018 with significant investment from institutional and individual investors. To manage currency exchange risks, a currency swap agreement was made with Standard Chartered Bank. However, due to a sharp decline in the fund's benchmark price in 2023, the hedging contract was terminated, leading to Standard Chartered Bank's demand for settlement.
Currently, the fund faces insolvency proceedings owing to a downturn in the European office market, exacerbated by rising interest rates and tenant vacancies. The litigation initiated by Standard Chartered Bank adds another layer of complexity to the asset sales, potentially hindering liquidation costs and increasing investor losses.
Industry observers note that Standard Chartered Bank has a strong position in this litigation, having won a similar case recently. The outcome of this lawsuit could significantly affect the remaining assets available for distribution to investors.
