Investigations by ‘pizza lover’ Antiguan diplomat led to major Credit Suisse revelation

OBSERVER: By Robert A. Emmanuel

Curiously described as a “pizza aficionado” by the Financial Times, a thorough investigation by an Antiguan diplomat led to the uncovering of one of Europe’s major banking news in recent years.

Dr Dario Item is Antigua and Barbuda’s Ambassador to Spain, the Principality of Liechtenstein, Monaco and the UN World Tourism Organisation, having been an international lawyer with extensive experience in banking law and asset management for many years.

When Dr Item agreed to become Antigua and Barbuda’s ambassador, putting Antigua and Barbuda in the minds of the major financial capitals of the world was likely one of his stated objectives, however, doing so by breaking a major financial story was not one of those ways.

In March 2023, the Swiss Financial Market Supervisory Authority (FINMA) ordered the write-down of banking giant Credit Suisse’s AT1 bonds worth around 16 billion Swiss francs (XCD $47.7 billion or US $17.6 billion) as part of a forced merger with rival bank, UBS.

Additional Tier 1 or AT1 bonds are a form of “contingent-convertible” bonds created after the 2007 global financial crisis to prevent the need for government-funded bailouts of precarious banks, according to the Economist.

The measure taken by the Swiss government therefore shocked financial markets as bondholders and investors appealed against the decision in the Swiss Federal Administrative Court.

According to the Financial Times which revealed that “Credit Suisse directly disputed the Swiss financial regulator’s basis for writing down [the AT1 bonds], in a private letter aimed at sparing staff bonuses that were tied to the debt”, Dr Item was the first to break the news on media organization Antigua.News.

On May 19 2023, the ambassador published the full contents of two decrees issued by the financial regulator, the first dated March 19, and the second decree March 22 which had been unknown to the public prior to Ambassador Dr Item’s revelation.

It is not often that a major international financial organization gets pipped to a major news story from the small island state of Antigua and Barbuda, but Ambassador Dr Item did just that.

“I wrote the article on Antigua News,” he told the Financial Times.

“I am also [the owner] of Antigua News and I am also a Swiss lawyer… defending some investors and for this reason, I have this information.”

In the FINMA decree, the ambassador discovers that the banking giant warned the regulator that there was no legal basis for the write-down and posited that the absence of that ‘contractual basis’ that led to an emergency law by Swiss government to better defend the regulator’s actions.

The story was later published by other major global financial news organisations.