When European markets opened on Monday morning there was a deep sense of foreboding. The decision by the Swiss regulators to wipe out $US17 billion ($25 billion) of Credit Suisse’s hybrids to broker its purchase by UBS was both shocking and uncertain.
The most jarring aspect was that the total loss of hybrid holders was not shared by Credit Suisse’s equity investors, which rank below them in the capital structure.
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Jonathan Shapiro writes about banking and finance, specialising in hedge funds, corporate debt, private equity and investment banking. He is based in Sydney. Connect with Jonathan on Twitter. Email Jonathan at jonathan.shapiro@afr.com
