When it was revealed that a Financial Stability
Board (FSB) official and a Deutsche Bank deputy general counsel
were going to share a panel session at the IBAs annual
conference in Dubai on November 2 on the use of contingent
convertible instruments (CoCos), it was only a matter of time
before the sparks began to fly.
The audience didnt need to wait long.
Following a general overview of the state of regulatory
progress by various European and US lawyers, Eva Hüpkes of
the FSB announced that CoCos would not be able to be in global
systemically important financial institution (G-Sifi) buffers
news that had not been made public at that stage.
Hüpkes of the FSB said that they had
considered the pros of allowing CoCos in the G-Sifi buffer, the
shareholder discipline effect and lower costs.
But at the end, those...