MILAN Japanese bank Nomura (8604.T) is seeking to establish British jurisdiction for its dispute with Monte dei Paschi di Siena (BMPS.MI) over risky derivatives trades, a source close to the matter said on Monday.
Nomura began proceedings in one of Britain's top court on March 1, the source said, speaking on condition of anonymity. On the same day Italy's scandal-hit Monte dei Paschi filed a damages claim in a Florence court against Nomura, as well as Deutsche Bank (DBKGn.DE) and two former executives of Monte dei Paschi.
The source added that Nomura was asking the High Court in London to declare that the "contracts are valid", a move aimed at ensuring that any legal dispute will be settled in London rather than Italy.
Both Nomura and Monte dei Paschi declined to comment.
Legal experts said it was common for investment banks to try to have legal disputes settled in London, Europe's main financial center, where attitudes towards banks are generally seen as being more favorable than in other countries.
In a landmark trial in Italy last December, four foreign banks, including Deutsche, were all found guilty of wrongly selling derivatives to the city of Milan.
Monte dei Paschi, which is at the center of an Italian probe into alleged corruption and fraud, is seeking at least 700 million euros ($909 million) in damages from Nomura and two former Monte dei Paschi executives, a judicial source told Reuters last week.
The Tuscan lender, the world's oldest bank and Italy's third-biggest, is also asking for damages of at least 500 million euros from Deutsche Bank and the same former managers over a separate derivatives deal.
A source close to the matter said that unlike Nomura, Deutsche Bank had not started proceedings about the case. Deutsche Bank was not immediately available for comment.
The derivatives trades are also under scrutiny by Italian prosecutors who allege that they were not fully disclosed to regulators by former Monte dei Paschi executives as they sought to conceal losses.
The bank in February put total losses from those two deals and one other at 730 million euros.
(additional reporting by Silvia Ognibene in Siena; Editing by David Goodman and Clelia Oziel)