Minimum Requirements for Cocos to be Included in Regulatory Capital and for Getting an S&P Investment-Grade Rating
24 Pages Posted: 25 Aug 2012 Last revised: 28 Aug 2012
Date Written: August 23, 2012
The following excerpts are taken from Basel Committee on Banking Supervision (BCBS), European Banking Authority (EBA), and Standard and Poor's (S&P) publications. They are intended to show the wide discretion which regulators demand over the interest payments and conversion of cocos and the equity-like features they impose on them already from the time they are issued. These regulatory requirements are not compatible with an investment-grade rating by S&P.
Keywords: Cocos, Contingent Convertible Debt Securities, Regulatory Capital
JEL Classification: G2, G3
Suggested Citation: Suggested Citation