![]() ![]() "RBI is committed to calling and refinancing at the earliest possible date, provide the economics make sense," an RBI spokesperson told Reuters. Now some smaller banks are no longer repaying the bonds - in an unwelcome development for investors - opting instead to keep them open-ended beyond five years and paying interest on them instead.Īustria's Raiffeisen Bank International (RBI) (RBIV.VI) is set to skip again an option to repay its 650 million euro ($716 million) AT1 bond in the middle of June. The trend highlights the vulnerability of global finance as it grapples with rocketing borrowing costs and the impact of war in Ukraine.Įarlier this year, Credit Suisse's near collapse prompted a Swiss government-backed rescue that wiped out billions of dollars of AT1 bonds, stunning investors and pushing up the cost for other banks wanting to sell their own. In the past, investors got their money back, and banks replaced the bonds with new ones, but some are changing tack. June 2 (Reuters) - Investors who earned easy money with high-risk bonds invented after the financial crisis are being forced to accept that the rules have changed: they may not get paid.īanks typically sold these perpetual bonds - known as AT1 bonds - with five years before an option to repay was triggered.
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