LONDON – One of the world’s biggest asset managers is considering joining hundreds of investors in challenging the Swiss regulator’s decision to wipe out about US$17 billion (S$23 billion) of Credit Suisse bonds following the bank’s takeover by UBS.

Pacific Investment Management Company (Pimco), which filed a suit against Swiss financial regulator Finma to meet an early May deadline for such submissions, has not yet joined any of the bond holder groups, according to a person familiar with the situation.

The firm is weighing whether to potentially pursue legal action to recoup some of its US$800 million of Credit Suisse’s so-called Additional Tier 1 (AT1) bonds, according to people familiar with the matter.

Those bonds were written down to zero after the acquisition and the Newport Beach, California-based asset manager was among the largest holders of the bonds.

Bond holders have argued that the write-down was an unfair and disproportionate move that put shareholders before bond holders. Defenders of Finma’s decision point out that the risk of a write-down was laid out in the bond documents.

The Swiss Federal Administrative Court has said it has received around 230 appeals, involving roughly 2,500 claimants, against the March 19 write-down.

They include bond holders in Singapore, with at least 100 investors joining a class action earlier in May to recover about $100 million in losses. This comes on top of other smaller groups of investors in Singapore also seeking redress over the wipe-out of their AT1 bonds.

Law firm Pallas Partners, which filed a suit in April, is seeking full compensation for its clients, which as at early May included 90 institutional investors and asset managers with US$1.35 billion in AT1 bonds, as well as 700 retail and family office clients accounting for some US$300 million.

Quinn Emanuel Urquhart & Sullivan filed in April and has now amassed more than 1,000 clients, including institutional investors, that held around US$6 billion in the bonds. Besides these, at least three other complaints have been filed. BLOOMBERG