TOKYO (Reuters) – Mitsubishi UFJ Monetary Group Inc will postpone the issuance of Further Tier-1 (AT1) bonds to mid-Could or later from late April, a spokesperson mentioned on Monday, after the Swiss determination to wipe out Credit score Suisse bonds rattled the market.
Mitsubishi UFJ selected the postponement making an allowance for investor urge for food and market circumstances, the spokesperson mentioned. He declined to touch upon the deliberate concern quantity.
Sources have mentioned Mitsubishi UFJ and Sumitomo Mitsui Monetary Group Inc, might put April issuance on maintain amid the volatility.
AT1 bonds – a $275 billion sector often called “contingent convertibles” or “CoCo” bonds – might be transformed into fairness or written off if a financial institution’s capital degree falls under a sure threshold.
As a part of the rescue of Credit score Suisse by its rival UBS, Swiss regulator FINMA decided that Credit score Suisse’s AT1 bonds with a notional worth of 16 billion francs ($17.35 billion) can be worn out, a call that shocked world credit score markets and angered many holders.
(Reporting by Ritsuko Shimizu and Makiko Yamazaki; Modifying by Varun H Okay)
