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AllianceBernstein, a US asset manager, is taking legal action against Switzerland for $225 million following the UBS takeover of Credit Suisse. The lawsuit is related to the writedown of $17 billion of Credit Suisse’s AT1 debt, which has affected bondholders like AllianceBernstein. The firm is joining other bondholders in pursuing legal action against Switzerland over the AT1 losses incurred during the Credit Suisse rescue.
According to the Financial Times, AllianceBernstein is set to be added as a plaintiff in a case brought by law firm Quinn Emanuel Urquhart & Sullivan on behalf of Credit Suisse bondholders. This comes after a group of bondholders holding $82 million worth of Credit Suisse’s AT1 debt filed a lawsuit against Switzerland seeking compensation earlier this year.
The lawsuit stems from the collapse of Credit Suisse in 2023 and its subsequent takeover by UBS, which was orchestrated by Swiss authorities. As part of this operation, Swiss regulator FINMA wrote down about $17 billion of Credit Suisse’s AT1s, causing anger among bondholders.
This latest development highlights the ongoing legal battle between bondholders and Switzerland over the losses incurred during the Credit Suisse rescue. It also sheds light on the potential impact of the writedown on bondholders and the financial industry as a whole.
AllianceBernstein’s decision to join the lawsuit further emphasizes the seriousness of the situation and the determination of bondholders to seek compensation for their losses. It remains to be seen how this legal battle will unfold and what implications it will have for the financial sector in Switzerland and beyond.