© Reuters. FILE PHOTO: The Canadian Imperial Financial institution of Commerce (CIBC) emblem is seen exterior of a department in Ottawa, Ontario, Canada, February 14, 2019. REUTERS/Chris Wattie/File Picture
(Reuters) – Canadian Imperial Financial institution of Commerce (CIBC) mentioned on Friday it will enchantment a New York court docket’s ruling in a lawsuit introduced in opposition to the financial institution by an entity of U.S. non-public fairness agency Cerberus Capital Administration.
Cerberus had alleged that CIBC defaulted on sure funds and is looking for damages of $1.067 billion. CIBC mentioned it had happy all its obligations.
The court docket issued a legal responsibility ruling in opposition to the lender, however has not decided how a lot it must pay. The events will get to current arguments on the damages at a listening to on Dec. 19, CIBC mentioned.
The lawsuit, filed in 2015, pertains to an October 2008 transaction by which CIBC issued a restricted recourse observe – a type of debt – to the Cerberus-controlled fund in change for an funding.
The Cerberus funding had helped CIBC handle and considerably cut back its publicity to the U.S. residential actual property market throughout the depths of the monetary disaster.
CIBC mentioned it expects to acknowledge a provision tied to the case in its first-quarter outcomes due in February, with out specifying numbers. The financial institution had up to now believed that the case “was extra possible than to not prevail at trial”, it added.
New York-based Cerberus didn’t instantly reply to a request for remark.
Authorized complications have pursued some companies nearly a decade and a half after the monetary disaster. In October, Financial institution of America (NYSE:) agreed to pay bond insurer Ambac Monetary (NYSE:) Group $1.84 billion, bringing to a detailed the final of the lender’s main lawsuits stemming from the crash.