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Logos of Swiss banks Credit Suisse and UBS are seen before a news conference in Zurich Switzerland, August 30, 2023. The state-engineered merger led to a wipeout of $17 billion of Credit Suisse's AT1 bonds. "Their structure is very new and shows they listened to investors who were angry about the permanent write-down feature," said Jerome Legras, head of research at Axiom Alternative Investments, who held Credit Suisse AT1 bonds before the March banking crisis. The Credit Suisse AT1s wipeout spurned a number of claims against Switzerland's financial regulator FINMA, which inverted the long-established seniority of bondholders over shareholders over the assets of a company in distress. That dented sentiment in the key market for bank bonds and prompted regulators in Europe and Asia to reassure investors.

Persons: Denis Balibouse, Jerome Legras, Joost Beaumont, March's writedown, Noele Illien, Dhara Ranasinghe, Elaine Hardcastle, Alexander Smith Organizations: Credit Suisse, UBS, REUTERS, CS, AT1s, ZURICH, P Global, Suisse, ABN AMRO, Singapore, Thomson Locations: Zurich Switzerland, Swiss, Switzerland's, Europe, Asia

REUTERS/Gonzalo Fuentes/File Photo Acquire Licensing RightsLONDON/DUBLIN, Sept 18 (Reuters) - Societe Generale's (SOGN.PA) much-hyped new strategy plans were given a thumbs down by investors on Monday, underscoring uncertainty over European banks as they face a brittle economy. "There are more questions about the future and the economy," Legras said, adding that transformative mergers between banks, which investors have waited for in vain, remained unlikely. Reuters GraphicsThat dampens the prospects for Europe's banks, whose valuations are low and static, said one adviser who works with top executives from the region's lenders, adding that investors struggle to see much promise for the sector. European banks' modest earning power has dampened investor appetite for their shares, which often trade at just a fraction of book value - the sum of their assets. While in the United States, JP Morgan and Morgan Stanley are valued at around 1.5 times book value, Germany's Deutsche Bank, Dutch lender ABN Amro, France's Credit Agricole and Britain's Standard Chartered are valued at just half book value or less.

Persons: Gonzalo Fuentes, Jerome Legras, Legras, Slawomir Krupa, Krupa, Goldman Sachs, JP Morgan, Frederic Rozier, Morgan Stanley, Karel Lannoo, Elisa Martinuzzi, John O'Donnell, Alexander Smith Organizations: Societe Generale, La Defense, REUTERS, Reuters, European Central Bank, European Union, Commission, Deutsche Bank, ABN Amro, France's Credit, Thomson Locations: La, Paris, France, DUBLIN, France's, Europe, United States, Germany, Mirabaud, U.S, Brussels

The latest move to restore calm to restive regional bank stocks came as Pacific Western Bank (PACW.O), one of the regional lenders caught up in the market volatility, said it had raised $1.4 billion from investment firm Atlas SP Partners. While that deal brought some respite to battered banking stocks, First Republic (FRC.N) remains firmly in the spotlight. For now, the rescue of Credit Suisse appears to have calmed the worst fears of systemic contagion, boosting shares of European banks (.SX7P) and U.S. lenders (.SPXBK). Reuters Graphics Reuters Graphics'HEAD IN SAND'The wipeout of Credit Suisse's Additional Tier-1 (AT1) bondholders has sent shockwaves through bank debt markets. Seeking to boost confidence among investors rattled by its $3 billion Credit Suisse rescue, UBS said on Wednesday it would buy back 2.75 billion euros ($2.96 billion) worth of debt it issued less than week ago.

March 22 (Reuters) - U.S. authorities are set to explore ways to bolster financial stability, along with steps to tackle the problems facing First Republic Bank, as central banks assess whether turmoil in banking makes interest rate rises less pressing. SVB's collapse kicked off a tumultuous 10 days for banks which led to the 3 billion Swiss franc ($3.2 billion) Swiss engineered takeover of Credit Suisse by rival UBS (UBSG.S). While that deal brought some respite to battered banking stocks, U.S. lender First Republic (FRC.N) remains firmly in the spotlight. Reuters Graphics Reuters Graphics'HEAD IN SAND'The wipeout of Credit Suisse's Additional Tier-1 (AT1) bondholders has sent shockwaves through bank debt markets. For now, the Swiss bank rescue appears to have assuaged the worst fears of systemic contagion, boosting shares of European banks (.SX7P) and U.S. lenders (.SPXBK).

UBS is buying back the bonds at the price at which they were sold rather than at market prices, compensating investors after a sell-off this week. UBS shares and bonds have seesawed this week as investors assess the impact of the Credit Suisse deal. The prices of the bonds UBS is buying back on Wednesday had also tumbled but partially recovered on Tuesday. "The issuer has decided to launch this exercise as a result of a prudent assessment of these recent developments and the issuer's long-term commitment to its credit investors," UBS said in its statement. UBS shares were last down 2.3% at 18.97 Swiss francs ($21.05), having risen as much as 3.6%.

But an unexpected jump in UK inflation last month led investors to bet heavily that the Bank of England will raise interest rates by at least another 25 bps on Thursday. SVB's collapse kicked off a tumultuous 10 days for banks which led to the 3 billion Swiss franc ($3.2 billion) Swiss regulator-engineered takeover of Credit Suisse by rival UBS. While that deal brought some respite to battered banking stocks, U.S. lender First Republic remains firmly in the spotlight. First Republic (FRC.N) shares fell 9% in extended trade on Tuesday, having surged as much as 60% at one stage. For now, the Swiss bank rescue appears to have assuaged the worst fears of systemic contagion, boosting shares of European banks (.SX7P) and U.S. lenders (.SPXBK).

FINMA, the Swiss regulator, said the decision would bolster the bank's capital. Engineered in the wake of the global financial crisis, AT1 bonds are a form of junior debt that counts towards banks' regulatory capital. "It's stunning and hard to understand how they can reverse the hierarchy between AT1 holders and shareholders," said Jerome Legras, head of research at Axiom Alternative Investments, an investor in Credit Suisse's AT1 debt. Credit Suisse's AT1 debt had rallied earlier on Sunday amid reports that shareholders would receive something in a deal with UBS, raising hopes that bondholders would be protected. The move by the Swiss regulator could make it harder for other lenders to raise new AT1 debt, investors said.

LONDON, March 19 (Reuters) - Credit Suisse has written down its Additional Tier 1 bonds to zero as part of its takeover by UBS, angering some bondholders who thought they would be better protected in a rescue deal announced on Sunday. The Swiss regulator and Credit Suisse said that the bonds, which are a riskier type of debt than traditional bonds, have a notional value of 16 billion Swiss francs ($17.24 billion). Credit Suisse said it had been informed by the regulator, FINMA, on Sunday of the decision to write the bonds down. Some bondholders were angry at the move to write down the bonds to zero, especially as it appears bondholders will fare worse than shareholders in the deal. ($1 = 0.9280 Swiss francs)Writing by Tommy Reggiori Wilkes; Editing by Hugh LawsonOur Standards: The Thomson Reuters Trust Principles.

FRANKFURT/LONDON, March 19 (Reuters) - Swiss authorities are examining imposing losses on Credit Suisse (CSGN.S) bondholders as part of a rescue of the bank, two sources with knowledge of the matter said on Sunday. Losses on bondholders may need to be larger if Credit Suisse were wound down rather than if it were taken over by UBS, one of the sources said. Authorities are trying to engineer a UBS takeover of Credit Suisse before financial markets reopen on Monday. A $1 billion deal would mean Credit Suisse shareholders getting a fraction of what their shares were worth on Friday. "I would be surprised if Credit Suisse bondholders, including AT1 investors, weren’t made whole.

As part of the overhaul announced in October, it is seeking to spin off merger advice and leveraged finance into a new entity named Credit Suisse First Boston (CSFB), for which it has been seeking buyers. Credit Suisse is most valuable in separate parts, and there are high-level M&A talks taking place, said a senior banker who advises banks on deals. TAKEOVERSelling off parts of Credit Suisse could require time, which markets may not give. The two have complementary investment banking businesses -Credit Suisse is stronger in credit and UBS in equities. However, some have faith that Credit Suisse can still make it safely to the end of the tight rope.

Credit Suisse fell below 2 Swiss francs ($2.18) for the first time after Saudi National Bank said it could not go above 10% ownership due to a regulatory issue. Credit Suisse shares fell by as much as 23.8% and were last down 20.2%. An index of European bank stocks (.SX7P) fell in morning trading and was last down 6.1%, hitting its lowest since January 3. Fears of contagion after the collapse of tech-focused lender SVB (SIVB.O) and New York-based Signature Bank (SBNY.O) last week have weighed on European bank stocks. We move from the problems of American banks to those of European banks, first of all Credit Suisse," said Carlo Franchini, head of institutional clients at Banca Ifigest in Milan.

Big hedge funds including Marshall Wace and Odey Asset Management added to short positions against Europe's banks, regulatory filings seen by Reuters and data from Breakout Point showed. Marshall Wace held the largest disclosed number of short positions against banks, public filings from Austria, Italy, Sweden, Britain, Spain and Poland analysed by Breakout Point showed. The banks included BAWAG (BAWG.VI), FinecoBank (FBK.MI), Handelsbanken (SHBa.ST), CaixaBank (CABK.MC), NatWest Group (NWG.L) and PKO Bank Polski (PKO.WA). BNP Paribas shares fell by as much as 12% on Wednesday before recovering to show a loss of 9%, while Deutsche Bank shares fell almost 9%. In the week to Wednesday, some 120 billion euros ($126 billion) had been wiped off the value of European bank shares.

LONDON/FRANKFURT, Jan 27 (Reuters) - Rising borrowing costs are giving a long-awaited lift to Europe's beleaguered banks, but they come with a sting in the tail. Last year central banks ended a decade of rock-bottom interest rates as the U.S. Federal Reserve and then the European Central Bank moved towards tightening. But while rising rates are good news for bank profits, they herald a slowdown in an economy hit by war and runaway prices that squeeze borrowers and could prick pricing bubbles, most notably in property. "On the one hand, interest rates are going up, which is good and helps banks," said Jerome Legras of Axiom Alternative Investments. Germany's financial regulator BaFin recently warned that a rapid rise in interest rates could weigh on some banks, and that loans may sour.

"The successful completion of the capital increase is a key milestone for the new Credit Suisse," its chief executive Ulrich Koerner said in a statement. Credit Suisse had already raised 1.8 billion francs by placing stock with a group of institutional investors led by Saudi National Bank (1180.SE). The exercise of subscription rights left only 16.4 million shares unsold. These are due to be sold on the market at or above the offer price of 2.52 Swiss francs, Credit Suisse said. Credit Suisse, has been battered by mishaps, including a $5.5 billion loss on U.S. investment firm Archegos.

Credit Suisse has already placed some 1.8 billion francs worth of shares with a group of institutional investors led by Saudi National Bank. "The rights issue is the necessary start to the process, said Jerome Legras of Axiom Alternative Investments. REVAMP AND RECORD LOWSCredit Suisse shares, which have plumbed record lows, were buoyed last week as its leadership sought to reassure markets. After closing above 3 Swiss francs on Monday, they have retreated slightly, finishing Wednesday’s session at 2.851 Swiss francs. Crucially, they have held above the deal subscription price of 2.52 Swiss francs and were at 2.821 Swiss francs, down around 1% in mid-session trade on Thursday.

LONDON, Oct 27 (Reuters) - Seeking to restore vigour to a business that's been languishing, Credit Suisse (CSGN.S) says it will reshape its investment bank by resurrecting the First Boston brand. Still, Credit Suisse says it expects CS First Boston to generate 14% of total group revenue by 2025, starting with annual sales of about $2.5 billion. Credit Suisse has been plagued by an exodus of senior bankers over the past 18 months. Yet most trading activities will remain within Credit Suisse, raising questions on CSFB's ability to compete with the likes of Goldman Sachs and JPMorgan (JPM.N). Credit Suisse is hoping to eventually pursue an initial public offering of CSFB, Körner told analysts.

And Italy's UniCredit (CRDI.MI) raised its 2022 profit goal, helped by higher interest rates and lower loan loss provisions that also drove quarterly earnings above forecasts. For years, banks bemoaned ultra loose monetary policy, but now higher interest rates means banks can start to benefit from the increased gap between what they charge borrowers and what they pay savers. Standard Chartered's third-quarter profit surged 40% as higher interest rates boosted the emerging markets-focused bank's income, giving it ammunition to upgrade its revenue outlook despite a weakening global economy. For Santander, higher loan loss provisions in key markets like Brazil and the United States overshadowed better than expected third-quarter earnings. While benefiting from higher interest rates, banks also face the unwinding of a scheme that buoyed their profits for years.

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