Swiss Investors Push For UBS To Settle Over Credit Suisse Bond Write-Off

2025-11-17 04:07:58

(MENAFN- Swissinfo) Swiss bondholders are exploring ways to push for a settlement with UBS, after a court ruled that the CHF16.5 billion ($20.8 billion) write-off of Credit Suisse bonds during the bank's 2023 rescue by its rival lacked a legal basis. This content was published on November 17, 2025 - 09:10 4 minutes Mercedes Ruehl in Zurich and Ortenca Aliaj and Simon Foy in London, Financial Times

The Swiss Federal Administrative Court delivered a surprise ruling last month that market regulator FINMA's order to write off the additional tier 1 bonds lacked a sufficient legal basis. FINMA and UBS are both appealing against the decision, which will now go to the Federal Court.

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The appeals process and subsequent proceedings could take years, and the court's decision will not be enforced while an appeal is pending.

Altana Wealth, a large holder of Credit Suisse AT1s which is part of a group led by law firm Pallas Partners that is challenging FINMA's 2023 write-off, said it thought settlement with UBS and FINMA was now a“likely outcome”.

“Our belief is both sides are incentivised to settle before that final decision [by the Federal Court],” said Lee Robinson, founder and chief investment officer of Altana Wealth, adding there was a“high chance” FINMA would push the cost to UBS.

AT1s are a class of debt designed to take losses when institutions run into trouble and generally rank ahead of equity on the balance sheet. The Credit Suisse rescue forced bigger losses on to some bondholders than shareholders, upending the traditional credit hierarchy.

The court stopped short of ruling whether investors should be repaid and any compensation from the process could take years to determine. Some analysts expect FINMA and the Swiss government to be the first in line to pay compensation claims if the ruling is upheld.

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