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US banking turmoil: Wipeout of risky bonds upends $275-billion market

UBS Group AG told Credit Suisse wealth bankers it's weighing financial sweeteners for them to stay as it seeks to reassure key staff following the takeover

UBS-Credit Suisse

UBS-Credit Suisse

Among the biggest losers in the shotgun sale of Credit Suisse Group are investors in the firm’s riskiest bonds, known as AT1s, worth $17 billion. 

These money managers are set to be wiped out — potentially sending that $275 billion market for bank funding into a tailspin, while threatening blowback for European policy makers in crisis-fighting mode.

Money managers are frantically poring through the fine print for these so-called additional tier 1 securities to understand if authorities in other countries could repeat what the Swiss government did on Sunday: Wiping them out while preserving $3.3 billion of value for equity investors. That’s

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First Published: Mar 20 2023 | 11:16 PM IST

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