The name is bond, FinCat Bond: Sense on AT1 Bonds
Recognise AT1 bonds as insurance, rather than pure debt. Once AT1 bonds are understood as insurance by a bank that is still a going concern, against a calamitous loss, the expectation that they should be bailed in only after equity is written off would disappear
The high-decibel angst of investors in Credit Suisse’s Additional Tier 1 (AT1) bonds that were fully written off before selling the bank to rival UBS for $3.23 billion resonates with investors in Yes Bank’s AT1 bonds, who are currently litigating against such a write-off at the hands of the RBI-appointed administrator, before the troubled bank was transferred to State Bank of India.
