The liquidators of Lehman Brothers Treasury BV (LBT) have recovered US$10.5bn of the US$34.5bn invested in almost 3,800 structured notes issued via the Dutch branch of Lehman Brothers Holdings Inc (LBHI), according to the fourth liquidation report, which was published on April 15. The report covers the period between September 1, 2014 and March 31, 2016.
Rutger J. Schimmelpenninck and Frédéric Verhoeven of law firm Houthoff Buruma announced that they intend to make a seventh distribution on outstanding series of notes and on acknowledged other ordinary claims as of April 28, 2016. According to the liquidators, LBT will distribute a gross amount of US$192m at an indicative distribution rate of 0.7%.
Distributions are made in accordance to the composition plan and are free of withholding tax, unless required by applicable law or regulation. Clearing systems, direct participants, noteholders, intermediary institutions, ultimate beneficial ownerships (UBO's) and holders of acknowledged claims or any other party entitled to any distributions from LBT are responsible for all tax consequences in any jurisdiction related to the direct or indirect receipt of or entitlement to these distributions, according to the liquidators.
A fifth distribution to note holders and other creditors took place during April 2015. In total US$792.7m was distributed. A sixth distribution took place during October 2015 when US$612.4m was distributed. An amount of US$12m was distributed in September 2015. With respect to the fifth distribution, payments on 52519VAD8, XS0168796570 and XS0168796653 were withheld due to operational review. As per the sixth distribution, the operational review was finalised and distributions were made on these series of notes, according to the report.
During the period, LBT paid US$824,435 to Houthoff Buruma representing professional fees and reimbursements for out-of-pocket disbursements for the services of the firm as liquidators and related legal services. VAT paid by LBT on these invoices is ultimately refunded by the Dutch tax authority. The liquidators spent 3,358.4 hours in the period under review and 7,421.3 hours since the effective date April 3, 2013 (end of bankruptcy: April 2, 2013).
LBT has an amount of US$35.6m in cash deposits with banks as of December 31, 2015 (June 30, 2015: US$54.9). This balance consists of US$13m held in US dollars, US$22.3m being the US dollar equivalent of €20.5m and US$161,898 being the US dollar equivalent of cash held in other currencies (translated at the rates of exchange prevailing on December 31, 2015).
At the October 8, 2008 bankruptcy date, 3,789 LBT notes were outstanding, with the vast majority (3,655) issued under the EMTN programme. Sixty-seven notes were issued under the Swiss program and 66 notes under the German programme. The Italian program only consists of one series.
In the Netherlands, where LBT was domiciled, the vehicle issued 24 structured products via Amsterdam based fund manager Wijs & Van Oostveen which collected combined sales of US$220m.
Click the links to read the fourth liquidation report, annex I, annex II and the final list of LBT note valuations.
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