Opinion ID: 393942
Heading Depth: 2
Heading Rank: 1

Heading: Banco Nacional and its Claims

Text: 4 As set forth in greater detail in our opinions in Chase, supra, and Citibank, supra, Banco Nacional is the central bank of Cuba and it played a leading role in the expropriations of private banks in Cuba. In September 1960, pursuant to Resolution No. 2 under Law No. 851, Banco Nacional acted as the alter ego of the Cuban government in taking over the Cuban branches of three American Banks: First National City Bank (Citibank), Chase Manhattan Bank (Chase), and First National Bank of Boston (Boston). See Banco Nacional de Cuba v. First National City Bank, 478 F.2d 191, 193-94 (2d Cir. 1973). 2 On October 13, 1960, pursuant to Law No. 891, the government of Cuba nationalized the Cuban assets and property of virtually all private banks not previously nationalized. Banco Nacional was placed in charge of the nationalized banks: 5 Article 2: As per the preceding article, all private Cuban banks are nationalized by forcible expropriation and are therefore awarded to the government of Cuba; this includes deposit and credit banks, mortgage banks, development banks, and all their assets, rights and shares of such banks in Cuba, and their bank accounts and deposits abroad. 6 The reasons given in the preamble to this law show this action to be in the public interest and for the social and National well-being and demonstrate the need for this expropriation. 7 Article 3: The nationalization and consequent award to the government of Cuba ordered in the preceding article is to be carried out through Banco Nacional de Cuba, as autonomous body in charge of the banking function of the state. Therefore, Banco Nacional de Cuba is declared the legal successor, substitute in lieu and stead of the artificial persons or firms mentioned in article 2 of this law, with regard to the assets, rights, and shares mentioned; to Banco Nac. de Cuba are transferred also all assets and liabilities of the banking institutions affected by this law. 8 Law No. 891. 9 On February 23, 1961, further reorganization of the Cuban banking industry was ordered. Law No. 930 reorganized Banco Nacional, and Article 6 of that Law provided as follows: 10 Article 6. The capital of the National Bank of Cuba shall be ONE HUNDRED MILLIONS OF PESOS ($100,000,000.00), which the State contributes out of the capital accounts, contributions, contingency reserves and profits of the institutions and official banking entities and of the banks nationalized by Resolution No. 2, issued by the President of the Republic and the Prime Minister of the Government on September 17, 1960, in pursuance of Law No. 851, of July 6 of the same year, as well as of the capital accounts, contributions, contingency reserves and earnings of the banking institutions which have also passed, for any reason, to the possession, administration or liquidation by the National Bank of Cuba. 11 The excess left over and above the capitals assigned, added to the balances of the contingency reserve accounts of the banks nationalized by Law No. 891, of October 13, 1960, excepting those pertaining to the banks referred to in the Second of its Final Provisions shall be used to set up the Contingency Reserve Accounts of the National Bank of Cuba. 12 The Private Banks as whose successor Banco Nacional sues here were nationalized pursuant to Law No. 891. They were Cuban corporations, domiciled in Cuba, whose shareholders apparently were Cuban. Banco Nacional commenced suit on February 6, 1961. It seeks to recover $428,639 from Manufacturers, $58,460 from Irving, and $238,368 from Chemical as amounts on deposits in the accounts of various of the Private Banks with the respective defendants. In addition, Banco Nacional asserts a claim against Chemical for $84,717, 3 to recover an amount deposited by Banco Nacional itself.