Contingent convertible capital: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson (Mend link.) |
imported>Doug Williamson (Mend link.) |
||
| Line 16: | Line 16: | ||
*[[Capital securities]] | *[[Capital securities]] | ||
*[[Hybrid]] | *[[Hybrid]] | ||
*[[PONV]] | *[[PONV]] | ||
*[[Primary Loss Absorbing Capital]] (PLAC) | |||
*[[Principal write down]] | *[[Principal write down]] | ||
*[[Additional Tier 1]] | *[[Additional Tier 1]] | ||
Revision as of 12:27, 25 June 2022
(CoCos.)
Contingent convertible capital is made up of hybrid capital securities that, through a conversion mechanism, provide additional capital available to absorb losses when the capital of the issuing institution falls below a certain level. They are generally used by banks in meeting regulatory capital requirements.
Depending on its terms, contingent convertible capital may be treated by regulators either as Additional Tier 1 (AT1) capital, or as Tier 2 (T2) capital.
The BIS's quarterly report of September 2013 has a useful primer on CoCos.
