Banking Crisis
Global Litigation House Builds Force To Challenge Credit Suisse AT1 Write-Downs
The write-down has prompted criticism, as holders of some equities appear to have gained more protection than holders of the AT1s.
A global specialist litigation law firm has said that it has
added over 1,000 holders of Additional Tier 1 debt that was
issued by Credit
Suisse, the value of which was wiped out when the Swiss state
brokered a UBS takeover of
the stricken Swiss bank.
Quinn Emanuel Urquhart & Sullivan said yesterday in a statement
that it has added more plaintiffs to its group appeal against the
Swiss Financial Market Supervisory Authority, or FINMA. A filing was submitted on
3 May. Quinn Emanuel has partnered with five law firms that
are representing investors with smaller bond holdings in the
US, the UK, Singapore, jurisdictions of the Gulf Cooperation
Council, and Switzerland.
AT1 bonds are high-risk forms of debt that European banks,
including Credit Suisse, issued as forms of buffer capital in the
aftermath of the 2008 financial crisis.
Under the terms of the UBS takeover in March, holders of SFr16
billion of AT1 debt,
said to include organisations such as BlackRock, Invesco and PIMCO, had their holdings
written down.
The write-down has prompted criticism, as holders of some
equities appear to have gained more protection than holders of
the ATIs.
On 18 April, Quinn Emanuel challenged moves by FINMA requiring
Credit Suisse to write down the AT1 bonds following the
acquisition of Credit Suisse by UBS.
WealthBriefing has contacted Credit Suisse about the matter.
Quinn Emanuel said it is working with the following firms:
-- US – Wollmuth Maher & Deutsch;
-- UK – Keidan Harrison;
-- Singapore – Engelin Teh;
-- Gulf Cooperation Council – Global Advocacy and Legal Counsel;
and
-- Switzerland – Geissbühler Weber & Partners.
“These bonds were sold to a large variety of investors, including
pension funds but also retail investors given that the Swiss
franc instruments in particular had a denomination and minimum
trading value of SFr5,000. With this additional group, the number
of affected investors exceeds 1,000 and the submission could
therefore be the largest collective complaint ever filed in
Switzerland,” Professor Thomas Werlen, managing partner of Quinn
Emanuel Switzerland, said.