All around the world, financial institutions provide liquidity to grow the real economy. As a result, financial institutions fulfil a crucial place in the market. Whether this relates to micro economic spending by natural persons, or project finance to meet public and private needs, financial institutions are an essential part of society. Therefore, the financial system must be protected where a healthy balance between public stability and consumer protection ensures confidence in the system. When things go wrong and a bank fails or is driven towards liquidation, a variety of consumer protection, insurance rules, and regulations help to protect the public interest and safeguard a minimum level of consumer protection. The consequence is that individual creditors are subject to civil arrangements that potentially lead to unexpected losses and asset write-downs. It is therefore recommended for creditors in bank failure and bank liquidation to closely monitor and scrutinize all possible routes that lead to repayment.

The holistic approach towards bank failure and liquidation used by Legal Floris LLC has a cross-border and international character. The structure of its asset recovery approach aims to create synergy where several different and isolated recovery procedures eventually lead to maximum recovery. It applies to every country where the rule of law is independent and consistent. Furthermore, this approach fits best to non-resident and international bank customers. This group in particular may experience practical challenges that re driven by misconceptions, conflict of laws and assumptions on the international level playing field.

Recent international bank failures

Banks fail for two reasons. Either there is a capital and liquidity shortage that prevents the bank from making payments on demand to their creditors, or the bank violated international regulation and is therewith banned from the global financial system. The first incident is bothersome but can be justified in some way by most creditors. The second occurrence however leaves incomprehension and even creditor outrage.

In a globalized setting, where borders fade away and consumers and corporations may purchase goods and services abroad, financial services gain a different character as well. People mostly assume that rules in their home country serve as a benchmark for international business, banking and finance. In reality, the lack of a uniform industry framework leaves gaps between different countries and their approach towards bank failure. As such, creditors must examine the applicable rules from the first moment that things go wrong.

Recently, several financial institutions in Europe, Asia, the Middle East and Middle and Latin America saw their license taken away for non-conventional and non-financial reasons. Most of these financial institutions acted as credit and liquidity providers and were forced into liquidation due to alleged violations of anti-money laundering and counter terrorism policies. In Europe such failures occurred in Belgium, Cyprus, Latvia, Luxembourg, and Malta. In the Caribbean, Middle and Latin America banks failed in countries like Antigua, the Bahamas, Belize, Granada, Panama, and St. Lucia.

International and non-resident creditors

There are legitimate reasons for individuals and corporations to bank abroad. The relationship between the bank and its foreign, non-resident customers is often grounded by efficient telecommunication and internet access. Facilities are tailored towards global use and payment systems are internationally available. However, international bank failure turns these benefits into disadvantages. It is for most international and non-resident creditors difficult to physically visit his bank abroad. Therefore, the representatives of Legal Floris LLC are always on location in the country where the bank fails. This allows them to understand local customs and generate results for our customers. By working in an efficient way, customer expenses can therefore also be limited and the outcome is therewith maximized.

Bank failure and liquidation assistance for creditors

At the end of this article we conclude and can answer the question in what countries we provide our services. This means that we take our customers by the hand and help them through the several stages of the bank resolution, recovery and liquidation stages to minimize risk and maximize repayment.

Our holistic approach towards recovery combines traditional and standard efforts with exclusive yet privately managed civil action. This approach is suitable in any country and jurisdiction with a solid legal system and protective measures such as government backed depositor protection and investor compensation schemes. Therefore, where we are able to group creditors, civil action and combined efforts can improve the end result. At the moment, Legal Floris LLC has ongoing actions in Cyprus, Latvia, Malta, Bermuda and the Bahamas. However, financial institution can fail at any unpredictable moment in time. As such, we work when and where we are needed!