EBA requirements on covered bond maturity extension could be ‘perilous’ for Denmark, says DBRS
The European Banking Authority’s recommendation that an issuer should have defaulted before a covered bond maturity can be extended could set a “perilous path” for Danish covered bonds warned DBRS in a note to clients. But the EBA said its recommendations are compatible with Danish law.
One of the EBA’s key recommendations for harmonising the covered bond market is that an issuer should not be able to extend a maturity at its discretion and that it should have defaulted first.
A issuer default would mean that investors would be able to enforce the
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