A market freeze on a risky type of bank debt is set to be broken Monday, with Swiss lender UBS lining up a sale of some contingent convertible, or CoCo, bonds, according to a person familiar with the deal.

The bond sale will be a crucial test of investor appetite for an asset class that was at the centre of a recent storm surrounding European banks. Concerns mounted in February that Deutsche Bank may not be able to make an interest rate payment on one of these securities, sparking a sell-off in the broader CoCo market and halting new deals.