Update on Commodities Member Default
Following the default of a Nasdaq Clearing Commodities member last week, Nasdaq would like to inform our members and clients that Mr. Aas and his lawyers have agreed to submit to a consensual arrangement with creditors to liquidate Mr Aas’s estate in order for Nasdaq to recover for the Default Fund Participants the losses arising from his recent default.
Nasdaq Clearing is exploring all rights and available options to pursue recovery for members and clients to minimize any shortfall and will liaise with members and clients on this matter. Any funds recovered by Nasdaq will be apportioned in accordance with the Default Fund Rules, i.e. be applied towards the Default Fund Participants on a pro rata basis.
Assuming Mr Aas will need to sell his private assets, how long do you think this will take?
· Nasdaq would support liquidation of the assets in a swift and timely manner consistent with realization of maximum value for members and will liaise with members in relation on this matter.
How will recovered funds be redistributed?
· The redistribution waterfall and priority are set out in the Clearing Rules and Default Fund Rules which will be followed.
Is it possible for the individual members to take legal action directly against Mr Aas in order to reclaim their share of the losses of the default fund?
· At present, Nasdaq has a right to indemnification in respect of the losses arising from the default and this is a claim against Mr Aas. Nasdaq is pursuing that claim vigorously with the discussions which have led to today’s proposal that Mr Aas submit to a consensual arrangement with creditors. We will liaise with members in relation to consensual arrangement.
Nasdaq Clearing is based in Sweden, the Exchange in Norway – what country’s laws are applicable in this case?
· Mr Aas is domiciled in Norway, so we are following Norwegian bankruptcy laws.
Are you making any reviews of your risk management practices at Nasdaq Clearing?
· We have engaged Oliver Wyman, a global management consulting firm, to conduct a review of our risk management practices at Nasdaq Clearing AB.
For more information, please contact:
Andreas Gustafsson, General Counsel Europe
For media inquiries, please contact:
David Augustsson, Corporate Communications
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