UBS landmark contingent tier two trades down, stirs up pricing debate

The FIG market struggled this week to interpret the latest data point for contingent capital as UBS’s tier two note — the first of its kind — was buffeted by turbulent conditions. Investors and bankers could not reach consensus on where the Swiss style low trigger tier two issue, which carries permanent write-down risk, should be priced, nor could they coalesce around a single reason for why the bond dropped three points the day after pricing.