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© Reuters. FILE PHOTO: A man walks past in front of a sign board of Mitsubishi UFJ Trust and Banking Corporation, the asset management unit of Japan’s Mitsubishi UFJ Financial Group Inc. (MUFG), in Tokyo, Japan July 31, 2017. REUTERS/Issei Kato

TOKYO (Reuters) – Mitsubishi UFJ (NYSE:) Financial Group Inc (T:) has postponed the issuance of Additional Tier-1 (AT1) debt, a spokesperson said on Monday, making the bank one of the first to do so after Credit Suisse AT1 holders lost some $17 billion.

Mitsubishi UFJ decided on the postponement taking into account investor appetite and market conditions, the spokesperson said.

The transaction planned for late April is now on hold until mid-May at the earliest, the spokesperson added.

He declined to comment on the planned issue amount.

AT1 bonds – a $275 billion sector known as “contingent convertibles” or “CoCo” bonds – can be converted into equity or written off if a bank’s capital level falls below a certain threshold.

As part of the rescue of Credit Suisse by its rival UBS, Swiss regulator FINMA determined that Credit Suisse’s AT1 bonds would be wiped out, a decision that surprised global credit markets as equity holders stand to recoup some of their money.

Reuters previously reported Mitsubishi UFJ and Sumitomo Mitsui (NYSE:) Financial Group were planning to issue AT1 bonds as early as this month but that the deals could be put on hold.

There are $69 billion worth of outstanding dollar-denominated AT1 bonds from Asian Pacific banks, according to Goldman Sachs (NYSE:) estimates, with mainland Chinese institutions accounting for 41% of total issuance.

Following Credit Suisse’s rescue a number of global regulators and central banks sought to calm investors’ nerves by saying they would continue to impose losses on shareholders before bondholders.

Masahiko Kato, chairman of the Japanese Bankers Association and the head of Mizuho Bank, said on Monday the Credit Suisse bond write-off was a special case where the AT1 bonds came with a clause warning investors they could be wiped out in the event of a government-backed bailout.

AT1 bonds issued by Japanese banks do not carry such clauses, he noted.

“I believe there would be no immediate impact on Japanese banks raising funds,” he said.

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