Contingent convertible capital: Difference between revisions
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(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. | 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. | ||
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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. | 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 [http://www.bis.org/publ/qtrpdf/r_qt1309f.pdf primer] on CoCos. | The [[BIS]]'s quarterly report of September 2013 has a useful [http://www.bis.org/publ/qtrpdf/r_qt1309f.pdf primer] on CoCos. | ||
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==See also== | ==See also== | ||
*[[ | *[[Additional Tier 1]] | ||
* [[Bank for International Settlements]] (BIS) | |||
*[[Capital]] | *[[Capital]] | ||
*[[Capital adequacy]] | *[[Capital adequacy]] | ||
*[[Capital securities]] | *[[Capital securities]] | ||
* [[Contingency]] | |||
* [[Contingent]] | |||
*[[Hybrid]] | *[[Hybrid]] | ||
*[[PONV]] | *[[PONV]] | ||
*[[Primary Loss Absorbing Capital]] (PLAC) | |||
*[[Principal write down]] | *[[Principal write down]] | ||
*[[Tier 2]] | *[[Tier 2]] | ||
[[Category:The_business_context]] | |||
[[Category:Corporate_finance]] | |||
[[Category:Investment]] | |||
[[Category:Long_term_funding]] | |||
[[Category:Identify_and_assess_risks]] | |||
[[Category:Manage_risks]] | |||
[[Category:Financial_products_and_markets]] | |||
Latest revision as of 09:36, 28 September 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.
