Un commento FT alla notizia postata da Amorgos:
Credit Suisse cocos issue deluged
By Jennifer Hughes in London
Published: February 17 2011 18:59 | Last updated: February 17 2011 18:59
Investors rushed to take up the benchmark issue by Credit Suisse of a new financial instrument hailed by regulators as a key tool for rebuilding the capital strength of banks, placing orders of $22bn – 11 times the $2bn on offer.
The deluge of orders represented a big vote of confidence in the nascent market for contingent capital bonds, dubbed cocos.
Priced with an interest rate of 7.875 per cent, the sale is likely to spur other banks to consider cocos, a hybrid form of capital where the notes rank above equity but below debt.
They are designed to convert into stock at a preset level of financial stress, delivering a capital boost to a struggling bank.
“This deal sends a really good signal to other banks of Credit Suisse’s quality,” a rival banker said.
Credit Suisse’s sale was considered a key test of market sentiment, since it was the first listed bank to offer the bonds in a standalone sale.
The other banks to have so far sold cocos are Rabobank, the Dutch mutual, which issued $2bn of cocos last month, and Lloyds Banking Group, which swapped £7.5bn ($12.1bn) for existing debt.
Barclays has considered issuing them, but has not obtained regulatory approval yet.
Only Swiss regulators have so far demanded their biggest banks issue cocos, but their counterparts across Europe are also looking closely at the role the bonds might play.
Brady Dougan, Credit Suisse’s chief executive, said: “We have, for some time now, supported the advent of contingent capital in Switzerland and we are pleased to contribute in this practical way to international debate on its role and feasibility.”
Asset managers took about two-thirds of Credit Suisse’s cocos, while private banks took a third on behalf of their clients. A total of 550 different investors – an unusually large number – put in orders for the bonds. The strong demand from asset managers was particularly important since they will form the backbone of any sustainable market for the products.
Credit Suisse’s deal was helped by the fact the bank anchored its coco deal by simultaneously announcing a agreement to swap $6.2bn of its existing hybrid debt for cocos - covering in one go about half the total cocos the bank needs to issue.
Credit Suisse shares closed 1.1 per cent higher at SFr44.64.
