Insurance Australia Group Settles A$2.8 Billion Greensill Lawsuit with Credit Suisse

Insurance Australia Group (ASX:IAG) announced on Friday it has reached a settlement in legal proceedings brought by Credit Suisse entities concerning insurance policies connected to the collapsed supply-chain finance firm Greensill. The agreement resolves a significant portion of the long-running litigation stemming from Greensill's 2021 failure.

Settlement Details

The lawsuit, filed in Australia's Federal Court against IAG's subsidiary Insurance Australia Ltd (IAL), involved claims with an aggregate face value of approximately A$2.8 billion (US$2.0 billion), plus interest, according to the company. IAG confirmed that the terms of the settlement are confidential.

Despite the size of the original claim, IAG stated the settlement would not have a material impact on its financial position or its fiscal 2027 results. The company attributed this to anticipated recoveries from its insurance, reinsurance arrangements, and other indemnities.

Market Reaction and Context

Investors responded positively to the news, with Sydney-listed IAG shares trading 1% higher at A$7.87 by 02:50 GMT following the announcement. The litigation relates to trade credit insurance policies purportedly issued by BCC Trade Credit on behalf of IAL to entities associated with Greensill Capital.

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The settlement marks another step for IAG in resolving legal issues tied to Greensill's collapse. In May, the insurer announced it had settled separate proceedings brought by Greensill Bank and its insolvency administrator.

Remaining Litigation

While the Credit Suisse case is now closed, IAG still faces other legal challenges related to Greensill. The company noted that separate proceedings brought by White Oak, with claims of about A$170 million plus interest, remain ongoing.

IAG confirmed that its subsidiary, IAL, continues to defend its position in the White Oak case. The series of lawsuits highlights the extensive financial fallout from Greensill's demise, which triggered significant losses for investors and lenders globally.