UBS could offer investors in AT1 bonds better terms in future, as executives mull the prospect of new issuances, according to reports.
Additional tier 1 securities were thrust into the spotlight during UBS's takeover of its ailing Swiss rival. They are designed to act as a safety buffer to avoid government or depositor bailouts, but would traditionally rank above equity in a bank's capital hierarchy — a relationship that was flipped on its head as bondholders were zeroed during the UBS-Credit Suisse deal while shareholders got a $3.25bn payout.
