RBNZ considers cutting contingent instruments from capital regime


The Reserve Bank of New Zealand (RBNZ) is considering the possibility of dropping contingent debt instruments from its capital regime, citing concerns over recent European experience.

In a document published today (July 14), the central bank says it has concerns over the complexity and side-effects of the instruments, which are sold as debt but contain “triggers” that cause them to convert to equity when a bank gets into trouble.

The RBNZ says it sees “little regulatory value” in “going concer

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