Editorial: Bail-in’s tricky start

Author: | Published: 9 Dec 2014

On November 28, the European Banking Authority (EBA) released its consultation on the criteria for determining the minimum requirement for own funds and eligible liabilities for bail-in, the so-called MREL. Using MREL, European authorities will ensure that banks have enough liabilities to absorb losses in case of failure, forcing shareholders and creditors to shoulder much of the recapitalisation burden, instead of taxpayers.

The MREL can be viewed as the European transposition of the Financial Stability Board's Total...