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Five-year extension for administration

A Russian-owned bank (VTB) had been made subject to sanctions imposed following Russia’s invasion of Ukraine, including its bank account being frozen.

As a result of the UK sanctions regime, VTB became unable to pay its debts, and administrators were appointed in 2022. The administrators applied to extend VTB’s administration for five years, to December 2029. 

The court granted the extension, deciding that it was in the best interests of the creditors where shorter, piecemeal extensions would likely increase costs of the administration. The administrators were promoting a proposed scheme of arrangement. The court was satisfied that the administration was effectively in “distribution mode” and that distributions to creditors either under the administration or under the proposed scheme would produce better results for creditors than liquidation.

In regards to VTB Capital plc [2024] EWHC 2612 (Ch).

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