Friday, 21 October 2016
Last updated 11 hours ago
Oct 30 2013 | 1:58pm ET
The nearly $300 million in collateral Barclays must return to hedge fund Black Diamond Capital Management isn’t even the half of it—literally.
Last week's court ruling, which found that the bank had breached a derivatives contract with the hedge fund, leaves Barclays liable to pay another $300 million to $400 million in interest and legal costs, the Financial Times reports. Black Diamond plans to seek 15.6%, the default interest rate, on the collateral, which it called in 2008.
A court will determine Barclays' total payout.
A New York appeals court found last week that Barclays violated its agreement with Black Diamond when it failed to meet the $40 million collateral call. When it didn't, Black Diamond declared it in default and demanded the return of the entire collateral. Barclays said it may appeal the ruling.