Doral Financial and committee move to settle claim with UMB Bank

By Sheri Kasprzak

New York, May 5 – Doral Financial Corp. and its committee of unsecured creditors filed a joint motion to settle a claim with UMB Bank, NA, said a filing with the U.S. Bankruptcy Court for the Southern District of New York.

As part of the settlement agreement, UMB will have an allowed claim against Doral for $16 million.

On May 22, 2015, Doral filed its schedules of assets and liabilities as having an unsecured nonpriority claim for $30,835,000 based on the loan guaranty.

“In compliance with the bar date order, the predecessor trustee timely filed against the debtor, on behalf of itself and all holders of the bonds, proof of claim number 86 asserting, based on the loan guaranty, a general unsecured claim in the amount of $30,901,112.92, together with all other amounts that it asserts the debtor is obligated to pay under the loan documents and the loan guaranty, including but not limited to prepayment or liquidated damages, interest, attorney’s fees and other expenses,” said the motion.

“Doral Properties’ obligations under the loan documents were partially satisfied through the proceeds of a sale of certain Doral Properties’ assets on Feb. 3, 2016. On Feb. 19, UMB filed against Doral Properties a proof of claim number 127 in the amount of $17,943,889.15, which takes into account the reduction in the obligations under the loan documents resulting from the DPI asset sale.”

As previously reported, the company filed is joint plan of reorganization on April 28. Under the terms, holders of general unsecured claims will receive a share of cash available for distribution and a share of interest in a creditors’ trust, which will entitle holders to further distributions. All existing equity interests and intercompany claims will be extinguished and canceled under the plan and administrative claims, priority tax claims and other priority claims will be paid in full in cash. Secured claims will either be paid in full in cash or holders will receive the collateral securing the claim.

Doral is a holding company based in San Juan, Puerto Rico. The company filed for bankruptcy on March 11, 2015 under Chapter 11 case number 15-10573.

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