CapLaw-2012-7

On 18 January 2012, Zürcher Kantonalbank (ZKB) launched a CHF 590m 3.50% Tier 1 Perpetual Subordinated Bonds transaction in the Swiss market, placed through UBS AG and ZKB as Joint-Lead Managers. These Tier 1 Perpetual Subordinated Bonds are a novel instrument, in particular providing for a write-down if ZKB’s CET 1 capital falls below 7% of its risk-weighted assets. Their terms comply with the requirements of Basel III as envisaged to be implemented in Switzerland and qualify as Additional Tier 1 Capital under the new Basel III framework. The Tier 1 Perpetual Subordinated Bonds will also be written down at…