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Swedish Banks Mull Joining $50 Billion CoCo Bond Boom 

July 14, 2014
Charles Daly, Bloomberg Businessweek

Swedish banks, the best capitalized in Europe, are weighing the sale of bonds with more rigorous triggers protecting against financial meltdown, a market in the region that has grown to $50 billion in about a year.

Swedbank AB (SWEDA) is among lenders talking with the country’s regulator about contingent convertible Additional Tier 1 debt, which are written down or convert to equity if capital falls below a pre-set trigger. An acceptable level in Sweden for so-called AT1s could be 7 percent to 8 percent, according to Gregori Karamouzis, the head of investor relations at Swedbank.

“Swedbank is absolutely considering issuing AT1 securities,” Karamouzis said by telephone from Stockholm July 8. “We expect the Financial Supervisory Authority to finalize details around the capital requirements by August or September, and provide some guidance on the loss-absorption trigger.”

Read More: Bloomberg Businessweek

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