Spanish banking giant Santander has successfully appealed a London court ruling that had mandated it pay approximately £677 million ($912 million) to French insurer AXA. The dispute centered on costs stemming from the mis-selling of payment protection insurance (PPI) in the United States. Santander is a global financial services company, offering a wide range of banking products and services. AXA, a French multinational insurance firm, provides various insurance solutions and asset management services.
London’s Court of Appeal overturned a High Court judgment from last year, determining that Spain’s Santander was not obliged under a 2000 agency agreement to reimburse AXA for costs linked to store-card PPI policies sold prior to 2005. AXA had inherited these policy liabilities through its 2015 acquisition of two units from Genworth. Santander, for its part, acquired GE Capital Bank, the original seller of these insurance products, in 2009.
In a judgment delivered by Judge Sara Cockerill, the appeal court clarified that the indemnity clause relied upon by AXA covered acts or omissions occurring *after* the agency agreement took effect on December 1, 2000, not policies sold beforehand. This ruling reverses the previous judgment that awarded AXA an indemnity of about £677 million, inclusive of interest. Santander had previously indicated that roughly 85% of this amount related to policies sold before the agreement’s signing. The Court of Appeal also dismissed AXA’s cross-appeal, which sought to recover additional PPI compensation costs.
Santander welcomed the ruling, stating that AXA would now be required to repay “the substantial majority of the amount” it had already paid. Conversely, Genworth’s President and CEO, Tom McInerney, expressed significant disappointment with the outcome. He indicated the company would evaluate its next steps, including potential options for further appeals against the decision.
