Belgian bank petitions to wind up Treasury

BELGIAN BANK KBC has petitioned the High Court to wind up troubled Irish property developer Treasury Holdings and 15 related companies.

All of the entities are involved in the Spencer Dock development in Dublin’s docklands, which KBC part-funded during the property bubble.

The action is to be heard by the High Court on August 8th.

KBC is owed about €75 million by Treasury relating to Spencer Dock. It was a 25 per cent partner in the banking syndicate that originally funded the loans for the docklands site. The loans of AIB, Anglo Irish Bank and Bank of Ireland were transferred to Nama.

This move adds to Treasury’s current legal woes.

In January, the National Asset Management Agency lost patience with Treasury and called in about €1 billion worth of its loans and appointed receivers to the various assets involved.

Treasury, which is co-owned by Richard Barrett and Johnny Ronan, then pursued a judicial review against Nama’s decision. A judgment on the matter is expected next week.

KBC is a notice party in Treasury’s legal action against Nama. This was noted by Treasury in a statement yesterday.

“KBC is fully aware of an impending judgment in the judicial review taken by Treasury against Nama in the High Court. As a named party to this review, KBC cannot circumvent these proceedings and to attempt to do so would amount to an abuse of due process,” Treasury said.

KBC declined to comment on its petitions.

However, earlier this month, as part of the developer’s judicial review proceedings against Nama, KBC told the Commercial Court it had served notice that it would seek to wind up Treasury if €20 million was not repaid in July under the company’s guarantee of loans, which remained unpaid.

KBC told the court that Treasury’s legal action against Nama was pointless. Treasury is insolvent with an overall debt of some €2.7 billion. Nama acquired €1.7 billion of those loans in 2010.

When Treasury sought leave for the judicial review, KBC told the court that the bank could not “take a decision to enforce the securities of the syndicated loan itself. It requires a decision of Nama to enforce the loans.”

KBC said it was in the “unfortunate position, as a minority member of the syndicate, that its majority syndicate partner is now a statutory body with public law obligations”.