UBS Group CEO Sergio Ermotti says the “unbelievable” market demand for the financial institution’s latest issuance of AT1 (extra tier one) bonds is a “sign to the Swiss banking system.”

The Swiss lender final week started promoting the bonds — which have been on the coronary heart of controversy throughout its emergency rescue of Credit score Suisse earlier this 12 months — for the primary time because the takeover.

Ermotti informed CNBC on Wednesday that he was “greater than inspired” by the huge oversubscription obtained for final week’s return to the market.

“The AT1 demand was unbelievable — 36 billion euros ($39.1 billion) of demand for what occurred to be 3.5 billion [euros] of placements — and in my viewpoint, it was in all probability the spotlight in a way of the arrogance is restoring not just for UBS, I’d say additionally it’s a sign to the Swiss monetary system,” Ermotti mentioned.

The wipeout of $17 billion of Credit score Suisse AT1 bonds in March, which was a part of the rescue deal brokered by Swiss authorities, triggered uproar amongst bondholders and continues to saddle the Swiss authorities and regulator with authorized challenges. Some commentators urged that it had undermined confidence within the historically steady and dependable Swiss banking system.

“The primary reactions have been primarily based on feelings or folks that have been very loud as a result of they’d their very own curiosity, however I believe that, as time glided by, folks had sufficient probabilities to actually have a look at the idiosyncratic state of affairs, and in addition in all probability look extra rigorously into the prospectus of what’s written,” Ermotti informed CNBC’s Joumanna Bercetche on the sidelines of the UBS Convention in London.

“These bonds have been designed to be there for these type of conditions so I believe that folks over time, or the overwhelming majority of the folks, are coming right down to a extra balanced approach of issues,” he added.