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Why some Credit Suisse bondholders are set to reap benefits from UBS takeover despite AT1 wipeout

Credit Suisse's senior bonds have been trading up in advance of its shotgun marriage to UBS

Some $200bn in debt has started looking attractive

Nikolas Kokovlis/Getty Images
By
Jeremy Chan

Credit Suisse's AT1 bondholders were wiped out in its shotgun marriage to rival UBS, but other investors who held more senior debt are set to receive an unexpected boon as the two banks close in on their merger.

The merger, forced through by Swiss authorities as Credit Suisse was on the brink of collapse, has buoyed several senior bonds over the past three months. As the deal prepares to complete on 12 June, this debt — worth around $200bn according to FactSet — will carry over to UBS as it snaps up Credit Suisse's balance...