US EditionSwiss Court Rules $20 Billion Credit Suisse Bond Write-Off Unlawful
The court ruled FINMA’s 16.5 billion franc AT1 bond write-off lacked legal basis, supporting investors who challenged the emergency Credit Suisse rescue in 2023.
- On Oct 1, the Swiss Federal Administrative Court revoked FINMA's decree in a test case, saying bondholders' property rights were 'seriously interfered with' and lacked clear legal basis.
- FINMA's March 2023 decree wiped out 16.5 billion Swiss francs of AT1 bonds during the UBS Group takeover, prompting investors to argue the conditions for write-down were unmet.
- Dealers increased offers for claims, quoting as much as 22 cents on the dollar from about 12, and Quinn Emanuel said `The Quinn Emanuel team is carefully reviewing the ruling to fully assess its implications`.
- The court suspended other cases until the revocation is final, with timing for compensation unclear; FINMA, the Swiss government and SNB may appeal to the Supreme Court while UBS shares slid over 3.5%.
- About 3,000 complainants lodged appeals across about 360 cases, with around 300 Singaporean AT1 investors claiming about $250 million and pursuing treaty arbitration led by Drew & Napier.
26 Articles
26 Articles
Switzerland court rules 20 billion Credit bonds write-off unlawful
The Federal Administrative Court of Switzerland ruled on Tuesday that writing off 16.5 billion Swiss francs ($20.53 billion USD) in Credit Suisse bonds was unlawful, calling into question the government’s approach to handling banking crises. Credit Suisse, a global Swiss bank, collapsed in March 2023, triggering a response from the Swiss Financial Market Supervisory Authority (FinMA). As part of their rescue plan, FinMA authorized rival bank UB…
The Swiss federal court has decided the first case over Credit Suisse's state rescue. 'Transactions without legal bases', savings betrayed
Bond write-off in Credit Suisse rescue unlawful
The Swiss authorities' 2023 decision to write off 16.5 billion Swiss francs ($20.53 billion) in Credit Suisse bonds was unlawful, a court said today, raising fresh questions about how the bank's rescue and subsequent takeover by UBS was handled.
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