A new era: a conservative CRD IV instrument

Rabobank designed its 8.4% perpetual non-call 5.5 instrument to comply as closely as possible with incoming European capital rules. In line with the draft fourth capital requirements directive and first capital requirements regulation — CRD IV and CRR I — it dropped an investor-friendly dividend stopper feature. And while many European institutions are hoping instruments with temporary principal writedown features will qualify under new rules, proceeding now meant Rabo had to stick with permanent loss absorbency.