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BCCI creditors get pounds 1bn payout boost

More than 35,000 long-suffering British creditors of the collapsed Bank of Credit and Commerce International took a big step towards seeing their first compensation payout as Abu Dhabi yesterday handed over pounds 1bn to the liquidators.

Deloitte & Touche said the precise amount to be paid to creditors is still subject to court decisions currently in progress. Earlier this year the liquidators had hinted that the payout would be at least 20p in the pound, but were hopeful of increasing this by recovering large funds from several litigation cases under way.

The final obstacle to settlement was cleared before Christmas in a Luxembourg court, ending years of frustration and legal squabbling since the bank was shut down by regulators in July 1991 following the discovery of massive fraud.

Abu Dhabi, which was the major shareholder in the bank, yesterday handed over pounds 1bn as part of an overall settlement worth pounds 1.2bn. Abu Dhabi has also paid pounds 167m into escrow which will be released later, the liquidators said.

"We are very happy our fight for five years has come to a fruitful conclusion and we urge the liquidators and the courts to reach a quick conclusion so that the dividend can be paid," said Adil Elias, chairman of BCCI Depositors Protection Association.

The money from Abu Dhabi forms the bulk of the retrieved funds, which amount to over pounds 2.2bn. About pounds 300m have been won in a settlement with Saudi Arabia's most prominent banking family, while a number of funds have been located in the United States.