On June 8, 2023, Zürcher Kantonalbank has successfully completed its inaugural EUR Bail-in Bond issuance in the amount of EUR 500 million. ZKB’s Bail-in Bonds are novel instruments which have been designed and issued on the basis of a new legal framework allowing Cantonal Banks to issue Total-Loss-Absorbing-Capacity (Gone-Concern Capital) Bonds. In the event that FINMA orders the partial or complete reduction of the bondholders’ claims under the Bail-in Bonds, the bondholders are entitled to receive a Recovery Certificate. Such Recovery Certificate includes claims, subject to multiple conditions precedent, for subsequent future compensation payments for the full or partial reduction of the bondholders’ claims under the Bail-in Bonds.
Homburger has advised ZKB on this issue. The team was led by partner Benjamin Leisinger (pictured left) and senior counsel René Bösch (pictured right; both capital markets and financial market regulation) and included Dieter Grünblatt (tax) and Sofiya Shavlak (capital markets).