MF Global’s UK administrator KPMG may be able to double payouts to customers and make its first payment to creditors after a three way settlement was agreed between the trustees of the US futures broker’s estate.
The FT reports that KPMG is set to lift payments to customers with segregated accounts from the initial forecast of 26 cents in the dollar to around 60 cents in the dollar, provided it receives US court approval and two parties withdraw claims against MF Global UK.
KPMG has said that if the terms are met it could make an initial distribution of 20p in the pound to unsecured creditors.
The deal is aimed at creating a quicker solution over the ownership of MF Global’s assets. The US futures broker went into administration in October 2011.
More than $1.6bn was found missing from its US accounts when it collapsed and a US congressional committee has accused former executives, led by former Democratic senator Jon Corzine, of misleading regulators over the size of its trades, although the money has yet to be found.
Investigations found large payments between the US and its UK unit in the days leading up to the collapse. KPMG and James Giddens have disputed ownership of assets in a bankruptcy under UK law. The two parties were due go in front of a UK court in April.
KPMG said the repayments were dependent on US court approval for the scheme at the end of this month. It also depends on the withdrawal of a claim for $236m by MF Global Finance USA, the trustee of MF Global’s holding company.
It also needs a financial institution – understood to be JPMorgan, MF Global’s bankers – to withdraw a claim into the MF Global UK estate and pay a receivable of $98m. JPMorgan declined to comment.