Credit Suisse shows it’s cool to CoCo

IN ITS ADVERT featuring a reclining tennis star Credit Suisse claims it helps Roger Federer to relax. Clearly its own staff are encouraged to be much more hyperactive and to develop fiendishly clever financial instruments. The latest, contingent capital bonds, or ‘cocos’, protect investors by converting automatically to equity at certain trigger points. The hybrid paper will enable those otherwise shut out of the bond market to access funds but is also likely to improve Credit Suisse’s fortunes too as early sales have been well received. Meanwhile Federer is still reported to be cool and relaxed knowing his $20m, 10-year deal with the bank is well funded. - 18/2/2011