Loss absorbing capacity

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Revision as of 17:03, 7 January 2015 by imported>Doug Williamson (Added Total Loss Absorbing Capacity to see also)
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(LAC).

In the field of bank resolution and recovery, loss absorbing capacity is the ability of a bank to suffer losses without falling below regulatory minima of capital and requiring re-capitalisation or resolution.

LAC may take the form of equity, subordinated debt, senior unsecured debt, and other unsecured uninsured liabilities.


See also

*Total Loss Absorbing Capacity 
  • PLAC primary loss absorbing capacity
  • SLAC secondary loss absorbing capacity
  • GCLAC or GLAC gone-concern loss absorbing capacity
  • MREL minimum requirement for own funds and eligible liabilities
  • MCT