Bankers in Asia expect contingent convertible
bonds’ (CoCos) structures to develop
idiosyncratically across the region.The Bank of China recently
submitted recommendations to the Basel Committee on Banking
Supervision that the scope of application of CoCos be expanded
on the basis of existing regulations to meet additional capital
requirement for G-Sibs [global systemically important
The statement, a response to the Committee’s
proposal that the bulk of additional loss absorbency for G-Sibs
be met with Common Equity Tier 1 (CET1), said the Basel III had
significantly increased bank’s capital
requirements and strengthened the leading position of common
equity in tier-1 capital.
"Another increase of additional capital requirement met...