Arab Bank assures shareholders of financial soundness after out-of-court settlement

AMMAN – Two days after reaching a settlement with plaintiffs in a years-long lawsuit in New York, Arab Bank on Sunday assured authorities and shareholders of its financial soundness. 

In a disclosure to the Jordan Securities Commission, the bank said its financial position is sounder than required by the Central Bank of Jordan and international oversight bodies. 

The announcement of the settlement was made Friday. 

The lawsuit filed by hundreds of Americans started in 2004, accusing the Amman-headquartered bank of providing financial services to the Palestinian group Hamas, which allegedly carried out attacks against their relatives. 

Arab Bank has always denied the charges, but in September last year a US jury in New York found Jordan's largest financial institution liable for injuries resulting from 24 attacks in Palestine.

Terms of the settlement were not disclosed by the bank. 

In its disclosure, the bank said the settlement was agreed as part of its efforts to protect its interests and that it comes in line with its prudent and precautionary policies. 

The disclosure said details of the settlement will be finalised and disclosed in the coming months, adding that the judge decided to postpone the start of a trial for damages portion from Monday (August 17) until May 2016. 

The case, known as Linde vs Arab Bank, started when a federal lawsuit was filed by hundreds of plaintiffs against the bank for allegedly holding accounts that financed attacks they claim killed members of their families in Israel and the Palestinian territories between 2001 and 2004.

The Amman bourse responded positively to the announcement of the settlement as the share price on Sunday's session went up by 7.5 per cent to JD6.45 per share over the JD6 registered in last session of Thursday. 

Arab Bank was first established in Jerusalem in 1930. With a capital of over $30 billion, the bank operates through more than 600 branches in 30 countries across five continents. 

Arab Bank is the largest Jordanian financial institution in terms of assets, equity and banking market share.