Written by Lisa Murimi
Zambia’s High Court has ruled that Standard Chartered Bank will not be required to pay \$500,000 in compensation to a former client who suffered losses from a now-defaulted Chinese property bond.
The ruling, delivered on September 8, found the London-listed bank had not breached Zambian laws in its 2022 sale of the bond but ordered it to cover the client’s legal costs.
The case stemmed from the bank’s sale of a bond issued by Sino Ocean, a major Chinese property developer that defaulted in 2023 during China’s real estate crisis.
The client, who lost \$320,000 in principal and sought an additional \$180,000 in damages, accused Standard Chartered of failing to disclose crucial risks and using restrictive contract clauses.
Earlier this year, Zambia’s Securities and Exchange Commission sanctioned the bank for breaching two rules: failing to disclose “material information” about Sino Ocean’s financial health and relying on “exclusionary” clauses that placed all risk on the buyer.
While the court found no statutory, contractual, or tort violations, the judge said Standard Charterer’s sales practices “fell short” of its own internal code of conduct and ethics. That shortcoming was enough to require the bank to pay legal costs.
Both parties may appeal the decision. Standard Chartered, which has operated in Zambia for nearly 120 years, did not comment on the ruling.
The case comes as the bank is restructuring its African operations, having announced plans last November to sell its retail and wealth management businesses in Zambia, Uganda, and Botswana.
