co-co

Swiss regulators have been pushing the so-called co-co bonds as a way to boost capital in case of a new financial crisis.

Strong Franc Squeezes Credit Suisse Deborah Ball 2011

Credit Suisse is testing the water with a public issue of Tier 2 co-co notes.

Credit Suisse Shows Co-Cos Are Go-Go Simon Nixon 2011

By contrast, UBS, which will hold back profits and not pay dividends for several years in order to meet the big-bank rules, has shied away from the co-co market, saying the new instruments aren't in the best interest of its shareholders.

Credit Suisse Defends Co-Co Bonds Katharina Bart 2011

Activist investment fund EthosFund—influential in Switzerland because it holds sway with Swiss pension funds—said shareholders should vote against Credit Suisse's plan to create as many as 400 million additional shares, part of which the bank needs to fulfill a six billion Swiss franc $6.69 billion contingent-convertible, or "co-co," bond issue sold to the government of Qatar and Saudi Arabia's wealthy Olayan family in February.

Credit Suisse Defends Co-Co Bonds Katharina Bart 2011

With the six billion franc issue to existing investors and a $2 billion public one shortly after, Credit Suisse is pioneering co-co bonds, which the SNB is pushing as part of a raft of measures aimed to safeguard the Swiss economy should one or both of Switzerland's largest banks, Credit Suisse and UBS AG, collapse.

Credit Suisse Defends Co-Co Bonds Katharina Bart 2011

Even so, Credit Suisse's total co-co requirement is likely to be 32 billion francs, according to Evolution Securities , so it can't rely entirely on existing investors.

Credit Suisse Shows Co-Cos Are Go-Go Simon Nixon 2011

Agence France-Presse/Getty Images Lloyds Banking Group and Credit Suisse have issued large amounts of the 'co-co' debt in recent years.

'Co-Co' Debt Finds Favor in Euro Zone Sara Schaefer Muñoz 2012

But while this is clearly good news for the nascent co-co market, it is too early to draw many conclusions for the rest of the industry.

Credit Suisse Shows Co-Cos Are Go-Go Simon Nixon 2011

So perhaps there is a market for co-co bonds after all.

Credit Suisse Shows Co-Cos Are Go-Go Simon Nixon 2011

A UBS spokesman said the bank was monitoring developments in the co-co market but had no further comment.

'Co-Cos' Tested by Credit Suisse Deborah Ball 2011