BofA, Deutsche, HSBC Bond Settlements Worth $96 Million Get Nod

Settlements worth $95.5 million resolving claims that Bank of America Corp., Deutsche Bank AG, and HSBC Holdings Plc conspired to rig the multitrillion-dollar market for bonds backed by foreign governments and multinational institutions were approved by a federal judge in Manhattan.

Judge Edgardo Ramos gave his blessing to the trio of agreements negotiated between 2017 and 2019, which call for Deutsche Bank to pay $48.5 million, HSBC to pay $30 million, and BofA to pay $17 million. The deal resolves part of a sprawling antitrust case against some of the world’s top banks.

It was “honestly negotiated by counsel with significant experience litigating antitrust class actions,” Ramos wrote April 2. “Success in complex cases such as this one is inherently uncertain, and there is no guarantee that continued litigation would yield a superior result.”

He also awarded $23.9 million in fees and $4.6 million in expenses to Quinn Emanuel Urquhart & Sullivan LLP and Robbins Geller Rudman & Dowd LLP, which are co-lead counsel for the pension funds behind the case. The fee figure represents one-quarter of the total settlement value.

The multidistrict lawsuit, consolidated in the U.S. District Court for the Southern District of New York, accuses the banks of manipulating the $9 trillion to $15 trillion market for “supranational, sub-sovereign, and agency” bonds, or SSA bonds.

It’s part of a wave of suits claiming top banks colluded in industry chatrooms to widen the spread between what they pay for bonds and what they get for them.

Other similar cases involve the $12 trillion secondary market for European government bonds, the $119 billion market for Mexican government bonds, and the $550 billion market for bonds backed by Fannie Mae and Freddie Mac.

The SSA bond suit is still pending in the U.S. Court of Appeals for the Second Circuit against Citigroup Inc., Barclays Plc, and other banks that beat the case last year. Deutsche Bank and BofA reached proposed settlements in 2017, and HSBC in 2019.

In his approval rulings, Ramos said co-lead counsel had “pursued the action and achieved the settlements with skill, perseverance, and diligent advocacy.”

Absent the deal, “there would remain a significant risk that the settlement classes may have recovered less or nothing,” the judge wrote. Given the case’s complexity, the value of an immediate recovery outweighs “the mere possibility of future relief after protracted and expensive litigation,” he added.

BofA is represented by Shearman & Sterling LLP. Deutsche Bank is represented by Allen & Overy LLP. HSBC is represented by Mayer Brown LLP.

The case is In re SSA Bonds Antitrust Litig., S.D.N.Y., No. 16-cv-3711, 4/2/21.