Recapitalisation amount: Difference between revisions

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imported>Doug Williamson
(Layout.)
imported>Doug Williamson
(Layout)
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''Bank [[resolution]] and [[recovery]] - capital adequacy''
''Bank resolution and recovery - capital adequacy''


The recapitalisation amount is the component of a bank's Minimum Requirement for own funds and Eligible Liabilities (MREL) which is considered necessary for recapitalisation after resolution.
The recapitalisation amount is the component of a bank's Minimum Requirement for own funds and Eligible Liabilities (MREL) which is considered necessary for recapitalisation after resolution.
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*[[MREL]]
*[[MREL]]
*[[Recapitalise]]
*[[Recapitalise]]
* [[Recovery]]
*[[Resolution]]
*[[Resolution]]
*[[Total Loss Absorbing Capacity]]
*[[Total Loss Absorbing Capacity]]

Revision as of 10:01, 16 November 2016

Bank resolution and recovery - capital adequacy

The recapitalisation amount is the component of a bank's Minimum Requirement for own funds and Eligible Liabilities (MREL) which is considered necessary for recapitalisation after resolution.


MREL itself comprises the total of a bank's:

  • Loss absorption amount; and
  • Recapitalisation amount.


The recapitalisation amount is most relevant for large complex banks, for which bailin is the likely resolution path.

Such banks would generally have a recapitalisation amount equal to the current minimum capital requirement.


On the other hand, smaller and simpler banks would not normally need any recapitalisation amount - because in resolution they would become insolvent, with no need to continue or resume operations and therefore no need for capital following the insolvency.


See also