© Reuters. FILE PHOTO: A pedestrian walks past a Credit Suisse logo in front of its office building in Hong Kong, China, March 21, 2023. REUTERS/Lam Yik
ZURICH (Reuters) – Switzerland’s financial market regulator FINMA gave more information on Thursday to explain the full redemption of AT1 bonds issued by Credit Suisse following the bank’s bailout.
FINMA has instructed Credit Suisse to fully redeem its AT1 instruments and to inform the relevant bondholders without delay.
“AT1 instruments issued by Credit Suisse contractually stipulate that they will be fully redeemed in a ‘feasibility event’, particularly if extraordinary government support is provided,” FINMA said.
“As Credit Suisse received extraordinary liquidity assistance loans secured by a federal default guarantee on March 19, 2023, these contractual conditions were met for the AT1 instruments issued by the bank,” it added.
Tier 2 bonds will not redeem, FINMA said.