2024-06-06 17:55:57
A bunch of Credit score Suisse bondholders holding $82 million of the bankrupt financial institution’s further debt (AT1) has filed a lawsuit in opposition to Switzerland in search of damages, in response to paperwork filed Thursday in a U.S. court docket.
Credit score Suisse collapsed in 2023 and was taken over by rival UBS in a rescue orchestrated by Swiss authorities. As a part of the deal, Swiss regulator FINMA wrote down regarding $17 billion of Credit score Suisse’s AT1 debt, angering bondholders.
The regulation agency Quinn Emanuel Urquhart & Sullivan, which represents the plaintiffs, mentioned the grievance was filed in federal court docket for the Southern District of New York.
The Swiss Ministry of Finance declined to remark.
The face worth of the AT1 bonds held by the plaintiffs is greater than $82 million.
AT1 bonds act as a buffer if a financial institution’s capital stage falls beneath a sure threshold, and have been inspired by regulators because the 2008-09 monetary disaster.
In a press release, Dennis Hranitzky, head of Quinn Emanuel’s sovereign litigation apply, mentioned the lawsuit seeks full compensation for the bondholders.
“Switzerland unnecessarily destroyed $17 billion value of AT1 devices and thus illegally violated the property rights of the holders of those devices,” Hranitzky mentioned.
Final week, UBS accomplished in Switzerland
fusion
of the principle mum or dad firms of UBS and Credit score Suisse. (Reporting by Dave Graham and Oliver Hirt; Writing by Elaine Hardcastle and Richard Chang)
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