Prague - One of the oldest and most complex cases in the history of the Czech banking system is finally over. 

After agreeing to an abitration settlement, the Czech state finally paid CZK 3.6 billion to the Japan-based investment holding Nomura as compensation for bankrupcy of a Czech bank.

The Czech state and Nomura fought over the collapsed IPB bank in countless lawsuits over the past decade. The longer the dispute has been going on, the more complex it has appeared to be. Here is roughly what happened.

The IPB bank (Investiční a poštovní banka), one of the first banks that was privatized after the Velvet Revolution and partly owned by Nomura, was placed under forced administration over what the then Social Democrat government argued was grave mismanagement and suspicious transactions.

Read more: Nomura ready to make peace with Czech state

Symbolic price of CZK 1

But the Czech state did something that no one quite expected - it sold the failed bank to another Czech bank ČSOB for the symbolic price of one CZK. Later on, the government provided ČSOB with money to cover the heaps of bad loans and debts that IPB had collected.

Nomura considered this step as grounds to sue the Czech state for failing to protect its investment in IPB. Since then, the two sides sides have been suing and counter-suing each other.

However, the Nomura Group won an arbitration lawsuit in London in 2006, based on which the Czech state and Nomura signed an arbitration settlement on compensation in November 2006. Consequently, both sides withdrew all the other pending lawsuits that they had filed against each other in the meantime.

Finally settled

Czech Finance Ministry confirmed Tuesday that Nomura has already received nearly CZK 3.6 billion, which is the final compensation, counted according to a formula set by the London arbiter's decision.

The price of the collapsed IPB bank was set this year as CZK 34.2 billion, which, according to the arbitration settlement's formula, meant acompensation of CZK 2.8 billion as well as interests that the Czech state was to pay to Nomura.

"We analyzed the state budget, in which we looked for possible reserves. Finally, we got the needed sum from state guarantees, investment tenders, debt service, international organization transfers and EU allotments," says Zuzana Chocholová from the ministry's press office.

Nomura originally wanted a compensation of CZK 40 billion, while the Czech state demanded CZK 111 billion in one of the numerous arbitration lawsuits as compensation for Nomura´s share in IPB collapse.