Enria: new legislation can help bolster AT1 market

The EBA is also reconsidering its advice to the European Commission on the treatment of CVA risk

Andrea Enria: defends the viability of AT1 instruments to absorb losses in a bank bail-in

February's sell-off in bank bonds reflected investor concerns about additional Tier 1 (AT1), or contingent convertible bonds (CoCos), raising questions as to whether CoCos, with their equity-like characteristics, need to be redesigned.

Deutsche Bank was forced to confirm it had enough reserves to pay interest on its AT1 securities, as investors worried that under German and European law, payouts on the bonds, which are tied to capital requirements, would be prevented.

Market participants called

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