BNP Reaches Compensation Agreement With Swiss Franc-Loan Clients

(Bloomberg) — BNP Paribas SA agreed to compensate clients who signed up for Swiss-franc mortgages that became ruinously expensive amid the financial crisis of 2008-2009, after the lender was found to be responsible for the damage they suffered in a ruling last year.

The Paris-based lender reached the agreement with customer association CLCV, both sides said in separate statements. The total amount to be paid out is expected to be between €400 million ($440 million) and €600 million, according to French daily Le Parisien.

“An agreement has been found with the CLCV association to offer an amicable solution for clients who request it,” BNP Paribas Personal Finance unit said the statement. About 4,400 clients could get compensation from the bank, CLCV said in a separate statement.

In November, a Paris appeals court ruled that BNP Paribas’s consumer finance unit was “fully responsible for the damage” suffered by a group of customers who sued the bank. The clients, who had taken on loans denominated in Swiss francs but redeemable in euros, saw their repayments shoot up when the Swiss currency became a haven as a worldwide credit crunch unfolded. 

Read more: BNP Loses Fight Over Swiss Franc Home Loans That Turned Sour (1)

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