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New from Credit Suisse: Bonds for self-inflicted catastrophes

Deal is a first-of-its-kind twist on the ‘catastrophe bonds’ that insurers have used for years to lay off risk of natural disasters

New from Credit Suisse: Bonds for self-inflicted catastrophes
Photo: Getty Images

Can a company buy insurance against accounting errors?

Credit Suisse is going to give it a try in the bond market. The bank plans as early as this week to launch unusual new securities that would pay investors relatively high interest rates. The catch is Credit Suisse could take their principal if incidents like rogue trading, information-technology breakdowns or even accounting errors lead to massive losses for the bank, people familiar with the offering said.

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