EC opens door to tier two — but will anyone issue?

06 Jun 2012

Prospects of Europe’s banks issuing Basel III compliant tier two have moved sharply closer with yesterday's announcement of a new bank resolution and recovery directive proposal. But complete certainty on issuance remains tantalisingly out of reach.

Hybrid structuring specialists said that Wednesday’s draft framework showed Europe would implement a statutory bank resolution framework. From 2018, all tier two paper will be subject to bail-in when a bank reaches the point of non-viability (PONV).

Some structurers said that this meant banks could go ahead and issue ...

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