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Bumkyu Sung and Ik Hwan Cho of Kim & Chang explain the impact and future of South Korea’s law separating banks and securities firms

With interest rates still low, yield-hungry investors are flocking to global debt capital markets. Freshfields Bruckhaus Deringer’s Peter Allen, Mark Trapnell and Denise Ryan discuss the key market drivers and reveal the next high-yield product

Clive Cunningham, Pat Horton and Nish Dissanayake of Herbert Smith Freehills explore the impact of the AIFM Directive on marketing alternative investment funds

Philippos Aristotelous In accordance with its commitment to its international lenders, Cyprus has made a number of changes to tax rates. With effect from January 1 2013 the corporate income tax rate has been increased from 10% to 12.5%. The rate of special defence contribution (SDC) on interest has also been increased, from 15% to 30%. The increase will take effect from the date of publication of the law in the official gazette, probably during May 2013. SDC tax is payable only by tax residents of Cyprus; non-resident individuals and companies are completely exempt, and interest on corporate financing or loan arrangements is subject to income tax rather than SDC tax.

Michael M Wiseman and Elizabeth T Davy of Sullivan & Cromwell explore the increasingly hostile US enforcement climate for financial institutions

The Securities and Exchange Board of India (Sebi) is considering easing restrictions on put and call options, which may lessen M&A uncertainty

Sandro Núñez Stock options are a kind of option right granted to employees. They allow those employees, within a specified term, to acquire equity in the employing company at a price agreed on the date of the call option. Stock options are created with the purpose of securing an employee's long-term commitment to the company, either as a part of a compensation plan, as a standalone agreement with a key employee, or as part of an M&A transaction where the selling parties intend to stay as part of the company's management.

International banks face regulatory uncertainty when underwriting India block trades

Leonardo Fernández Rodríguez According to Law 9/2012 on restructuring of credit entities and Royal Decree 1559/2012 that develops Law 9/2012, the Spanish bad bank Sociedad de Gestión de Activos procedentes de la Reestructuración Bancaria (Sareb) is entitled to incorporate separate estates under the form of bank assets funds (fondos de activos bancarios, or FABs) to which it may assign either assets or assets and liabilities from its balance. FABs will operate as a mix of a securitisation fund and a collective investment vehicle. Assets eligible to be transferred to any FAB are not limited to those previously assigned to Sareb by credit entities subject to public aid according to applicable legislation, since the eligibility criteria also extends to money and deposits as well as fixed income notes listed in any official secondary market.

Anna Pinedo Five years following the outset of the financial crisis, the debate regarding regulatory capital levels for US banks only seems to have intensified. The US banking agencies released notices of proposed rulemaking relating to regulatory capital in mid-2012; these proposals were the subject of intense commentary. To meet G-20 commitments, it was assumed final capital requirements for US banks would be released by mid-2013. However, given new legislative proposals, and new recommendations from policymakers, the country seems to be further from any consensus regarding an approach to regulatory capital and prudential regulation. Recently, Senators Sherrod Brown and David Vitter introduced proposed legislation that would set Basel III aside, and require adoption of new capital requirements focused principally on common equity, or an equity capital ratio, and impose at least a 15% minimum capital requirement on large US banks. The bill also would require separate capital requirements for subsidiaries, and limit the permitted activities of banks and their non-bank subsidiaries. Although the bill may never receive the bipartisan support required for approval, it is nonetheless important in that it illustrates the continuing debate over too-big-to-fail institutions. It also suggests that perhaps the actions that already have been taken following enactment of the Dodd-Frank Act are not sufficiently well-understood.