Following the publication of the report of the parliamentary commission of inquiry, 47 American investors are demanding compensation of around 372 million dollars from Switzerland, compared to 86 million last June.
The complaint by American investors against Switzerland in the context of the cancellation of the value of Credit Suisse’s AT1 loans is gaining momentum. The lawyers now refer to the report of the parliamentary commission of inquiry (CEP) on the bank debacle in a new version of the complaint, filed Wednesday evening.
This demands compensation from Switzerland of approximately 372 million dollars, compared to 86 million dollars when the complaint was filed last June with the New York district court. The denunciation, of which the AWP press agency became aware, now lists 47 investors.
Growing bondholder interest in the U.S. complaint highlights the “widespread impact of the AT1 writedown” on various investors, reads a Thursday position paper from attorney Dennis Hranitzky of U.S. law firm Quinn Emanuel.
“Unnecessary measure”
As part of the emergency takeover of Credit Suisse (CS) by UBS in March 2023, the high-interest AT1 bonds, worth around CHF 16 billion, had been declared worthless by order of the Federal Financial Market Supervisory Authority (Finma). The plaintiffs are now arguing in the US court that this measure was unnecessary and that it provided benefits to UBS.
American lawyers also draw other legal ammunition from the CEP report: according to them, it also shows that the reduction of AT1 loans to zero constituted an illegal infringement of the plaintiffs’ property rights.
During the sale of the CS, Switzerland ignored a “multitude of potential buyers” and “driven by pride and economic nationalism” only took into account UBS, the lawyers deplore. The bank with the three keys could thus have determined the price and dictated the conditions of the recovery.
Switzerland now has until early February to respond to the updated complaint. A decision by the New York court on its acceptance should therefore not be made before the summer.
