The Provisional Liquidators (PLs) of MF Global Hong Kong Limited (MFG) are pleased to announce that the Hong Kong Court has this morning approved an interim distribution of up to HKD500 million of clients' monies.
Patrick Cowley, a Principal at KPMG in Hong Kong and one of the Provisional Liquidators, said: "Since the business closed down over a month ago, we have been working both to recover clients' funds and to reconcile clients' claims to those funds. This process will take time to complete, and the purpose of today's application was to enable the early return of a portion of clients' funds. The Court accepted that in these particular circumstances, an interim distribution is appropriate and will go a long way to relieving clients' financial distress."
Cowley added: "Based on recoveries and information available to date, we expect ultimately to be able to return something in the region of 90 percent of client funds, possibly more if we can recover funds currently held by MF Global affiliates overseas. The total balance of clients' funds held by MFG on 28 October 2011 was approximately HKD 1.2 billion, so the interim distribution represents about 40 percent of that sum. We will be working towards making payments to the majority of the clients in the coming 2-4 weeks. Certain clients may need to wait slightly longer, where we are still missing critical data in respect of their claims, particularly relating to the close out of their trading positions. This is an important step forwards for MFG's clients, but the PLs recognise the need to complete the ongoing reconciliation exercise as soon as possible, so that we can return more of their money."
MFG's business is currently being wound down, with about 15 of the original 90 staff currently retained by the PLs to assist in the liquidation process.
KPMG's Patrick Cowley, Fergal Power and Lui Yee Man were appointed as Provisional Liquidators of MFG on 2 November 2011.
Prior to its collapse, MF Global operated as a global broker of exchange-listed futures and options. It also provided execution and clearing services for over-the-counter derivative products as well as for non-derivative foreign exchange products and securities in the cash market. The group operated in 12 countries on more than 70 exchanges. It had a client base of more than 130,000 active accounts ranging from financial institutions, industrial groups, hedge funds and other asset managers to professional traders and private/retail clients.
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