Could TLAC kill the structured notes business?

FSB proposals exclude structured notes from banks’ bail-in debt buffers


Regulators' drive to end the too-big-to-fail problem may be about to claim an innocent victim: bank structured note funding.

Under proposals issued by the Financial Stability Board (FSB) in November, global systemically important banks (G-Sibs) will be required to hold bail-inable debt equivalent to between 16% and 20% of their risk-weighted assets (RWAs) – essentially, an extra capital buffer that could be tapped at the point a failed dealer needed to be resolved.

The FSB says bank paper issued

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