"Bank Error in your favour"

[h0b0]

Apparently, Banks do not like it when they make an error and they can't claw it back. It seems ironic to me when so many times we hear of accidental transfers happening to the consumer and banks refusing to refund. Well, here is karma...

Judge Lets Revlon Lenders Keep Citi’s Botched $500 Million Payment

[Simpo Two]

Well, the money was due anyway, just not quite so quickly!

[Sheepshanks]

What struck me as odd about this it that you'd think companies in the business of lending would want to keep the money lent out - so interest kept coming in. You'd think they'd be a bit a pissed about it being unexpectedly repaid.

[NickCQ]

Sheepshanks said:

What struck me as odd about this it that you'd think companies in the business of lending would want to keep the money lent out - so interest kept coming in. You'd think they'd be a bit a pissed about it being unexpectedly repaid.

This was a distressed situation in which the ability of the underlying borrower to repay was in doubt. The dissenting lenders that refused to return the money were mostly secondary buyers that bought into the capital structure at a discount.

I am surprised that there weren't indemnification provisions in the loan doc that allowed this to be reversed.