97 S Korea Exporters Sue Banks Over Forex Losses
2008年11月4日
Ninety-seven small and midsize exporters filed a class action suit Monday against 13 major banks over the aggressive sale of currency options that went sour when the South Korean won plunged against the U.S. dollar earlier this year.
The businesses, represented by the Korea Federation of Small Enterprises, are seeking the nullification of the options contracts, known as 'knock-in knock out', or KIKO.
The businesses, along with about 400 others, as of August had lost a combined KRW1.7 trillion from the contracts. Their losses have grown since then as the won lost more value in September and October. Through Monday, the won had lost 26.5% of its value against the dollar this year.
In the lawsuit, the businesses allege that the banks structured the contracts in a way that made them more risky than regular currency hedges.
Some of the KIKO contracts were promoted by local and provincial government agencies. The South Korean government has pledged to help businesses whose financial survival has been threatened by KIKO liabilities.
The contracts became major news in South Korea in September when mounting losses related to them forced some midsized companies, including a maker of parts for flat-panel TVs, into bankruptcy.
Class-action lawsuits are a relatively new phenomenon in South Korea, which began to allow them about five years ago. They've been growing in frequency. Attorneys say more such lawsuits are likely to be filed related to the KIKO debacle.
Evan Ramstad |
|
