Spanish bank Santander said Tuesday it will reimburse its private clients who lost money in financier Bernard Madoff's alleged fraud.

Santander became the first institution to offer such compensation in the midst of one of the largest alleged ponzi scheme frauds in history. It would pay back 100 percent of the investments made in the Optimal Strategic US Equity fund, which had investments with Madoff.

The total payment will be 1.38 billion euros ($1.81 billion) in the form of Santander preference shares, paying an annual 2 percent return. Santander will repay its individual private banking clients but not institutional investors. In exchange the firm will ask its clients not to sue.

The Spanish bank reported its clients lost a total of 2.33 billion euros to the alleged fraud. However Santander’s program will repay only 1.38 billion. It its excluding investments by institutional clients and the nominal returns from Madoff that never existed apparently, the Financial Times reported.

Madoff is author of an alleged $50 billion ponzi scheme fraud performed through his securities brokerage which has affected investors all around the world.