UBS launches first AT1 bonds since Credit Suisse takeover

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UBS is looking to raise its first additional tier 1 bond since $17bn worth of the risky debt instruments were wiped out when it took over rival lender Credit Suisse. 

The Swiss bank launched a deal to raise new dollar AT1 bonds on Wednesday, split between debt that can be redeemed in five years and 10 years. AT1 bonds have a perpetual maturity and are designed to take losses in times of crisis.

Swiss authorities’ decision to write down $17bn of Credit Suisse’s AT1 bonds in March, as a condition of its shotgun marriage to UBS, provoked uproar and has led to a number of litigations. 

UBS is marketing the five-year tranche at about 10 per cent yield and the 10-year at about 10.125 per cent.

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