Legal battle over Italian swaps drags on, frustrating dealers

Despite banks claiming victory in London over disputed interest rate swaps, parallel Italian proceedings could delay payouts

In an unwelcome echo of the famous Dickensian legal dispute, Jarndyce v Jarndyce, derivatives dealers are locked in an interminable series of lawsuits with Italian local authorities who are resisting claims that they have reneged on interest rate swaps, many of which date back before the 2008 financial crisis.

But while banks have been successful in recent hearings in English courts, lawyers say they won’t see any payouts until the local authorities’ counterclaims are heard in the Italian courts