Bondholders of Credit Suisse Group AG have filed a lawsuit against the Swiss banking regulator on behalf of $4.5 billion of the company’s $17 billion in additional tier 1 bonds, the Financial Times reported on Friday.
His complaint said regulator Finma was unconstitutional when it ordered Credit Suisse to cancel AT1’s debt following a rescue merger with UBS. Financial Times reported.
The mid-March move by Swiss regulators angered bondholders who believed they would be better protected than shareholders in a rescue deal with UBS earlier this month.
The lawsuit was filed on Wednesday by Quinn Emanuel law firm in St. Gallen, eastern Switzerland, the report said.
When hired by the bondholder group earlier this month, Quinn Emanuel said the bondholder group held a “significant” percentage of the total notional value of the bonds.