BERN: Credit Suisse Group AG bondholders, representing US$4.5 billion of the US$17 billion of wiped-out Additional Tier 1 bonds of the company, have filed a lawsuit against Switzerland’s banking regulator, the Financial Times reported today.
The complaint says the regulator, Finma, acted unconstitutionally when it ordered Credit Suisse to cancel the AT1 debt, the FT report said.
This move by the Swiss regulator in mid-March angered bondholders who thought they would be better protected than shareholders in a rescue deal with UBS earlier in the month.
The lawsuit was filed by the law firm Quinn Emanuel in the city of St Gallen in eastern Switzerland on Wednesday, FT said.
The bondholder group holds a “significant” percentage of the total notional value of the bonds, Quinn Emanuel said earlier this month when it was hired by the bondholders group.