What is unusual here, in the case of the Credit Suisse and USB buyout, is that the whole thing happened so fast that the bondholders were left with nothing overnight (something that the banks and Regulator say was written in to the bonds from the start as a possibility).
Typically, bondholders get something if things go wrong. Normally, it is the shareholders that end up losing out. This time things have played out the other way around.
‘This time things have played out the other way around’
Because of their unique perhaps more risky nature, AT1 Bonds tend to offer higher payouts than other types of bonds.
It’s also worth noting that AT1 Bonds, due to their complexity and risk profile, are typically only available to big institutional investors, rather than individual retail investors.