Japanese investors have sued Mitsubishi UFJ Financial Group’s joint venture brokerage with Morgan Stanley, showing that the fallout from losses on Credit Suisse’s riskiest debt continue to reverberate around the world.
The suit was filed Thursday to the Tokyo District Court on behalf of 66 plaintiffs, demanding ¥5.2 billion ($36 million) in compensation from Mitsubishi UFJ Morgan Stanley Securities. They are seeking to recover losses from so-called Additional Tier 1 notes that were sold by the firm, according to the filing led by Yamazaki Marunouchi Law Office.
Bondholders lost everything when about $17 billion of these securities were wiped out during UBS Group’s emergency takeover of Credit Suisse. Some reacted with anger when UBS said this month it won’t need state support for its rescue deal after all. The debacle has sparked various lawsuits around the world, and the latest case in Japan hits its largest lender.