Feb. 25 (Bloomberg) -- HSBC Holdings Plc’s Brazilian unit may have to pay as much as $600 million if courts in the country rule in favor of savers suing its banks.
Lenders including Itau Unibanco Holding SA and Banco do Brasil SA are being targeted by depositors seeking reimbursement for losses stemming from government policies adopted to fight hyperinflation in the 1980s and 1990s.
“Such losses may lie in a range from a relatively insignificant amount to an amount up to $600 million, although the upper end of this range is considered unlikely,” London-based HSBC said in its annual report published yesterday.
The central bank estimates lenders would have to pay 150 billion reais ($64 billion) to depositors and may reduce lending by as much as 1 trillion reais if the court rules against them. No date is yet fixed for the ruling.
Claimants allege savings account balances were “adjusted by a different price index than that contractually agreed, which caused them a loss of income,” HSBC, Europe’s largest bank, said in the report.
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