Bericht
Implementing bail-in properly
A recent proposal by the Financial Stability Board (FSB) suggests a new risk capital buffer for globally operating systemically important financial institutions. The suggested metric, "Total Loss Absorbing Capacity" (TLAC), is composed of Tier-1 capital and loss absorbing debt. In a crisis situation, "bail-in-able" debt is to be written down or converted into equity. Jan Krahnen argues that the credibility of bail-in, in the case of systemically important financial institutions, hinges crucially on the design of TLAC and the requirements that will be placed on loss absorbing "bail-in-able" debt.The fear of direct systemic consequences through bail-in could be overcome, if a holding ban were placed on the "bail-in-bonds" of financial institutions. The holding ban would stipulate that these bonds cannot be held by other institutions within the banking sector.
- Sprache
-
Englisch
- Erschienen in
-
Series: SAFE Policy Letter ; No. 35
- Klassifikation
-
Wirtschaft
- Thema
-
total loss absorbing capacity (TLAC)
too big to fail
bail-in
nachrangiges Fremdkapital
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Krahnen, Jan Pieter
- Ereignis
-
Veröffentlichung
- (wer)
-
Goethe University Frankfurt, SAFE - Sustainable Architecture for Finance in Europe
- (wo)
-
Frankfurt a. M.
- (wann)
-
2014
- Handle
- URN
-
urn:nbn:de:hebis:30:3-356804
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
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Objekttyp
- Bericht
Beteiligte
- Krahnen, Jan Pieter
- Goethe University Frankfurt, SAFE - Sustainable Architecture for Finance in Europe
Entstanden
- 2014