Solvency II poses bigger danger to economic stability than bank refinancing
Solvency II capital charges on corporate credit portfolios backing annuity books will reduce insurers' appetite for corporate paper to such an extent it poses a greater risk to financial stability than bank refinancing pressures, according to the chief executive of a UK insurer.
Even with the Committee of European Insurance and Occupational Pension Supervisors' concession of adding a liquidity premium to the risk-free discount rate used to value liabilities, consensus has emerged that optimal
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