Investors representing $4.5bn of wiped-out Credit Suisse bonds have filed a lawsuit against Switzerland’s banking regulator, in a dispute which challenges the country’s reputation as the world’s most politically stable and reliable financial centre.
The claim is the first to be brought by holders of $17bn of Credit Suisse convertible bonds which were rendered worthless by the bank’s government-orchestrated rescue by rival UBS last month.
It is the opening salvo in what lawyers have told bondholders is likely to be a multiyear process in the Swiss courts. By value alone, the case is one of the biggest bondholder disputes to embroil a sovereign country. One lawyer involved compared it to the long-running saga concerning Argentine government creditors who were eventually paid out $9.3bn in 2016 in the “sovereign debt trial of the century”.