Hybrids in the news

Investors, not government, should shoulder banks' risks

PowerShares Debuts Convertible Bond ETF

The latest addition to PowerShares’ ETF lineup is a fund focusing on convertible bonds, a unique asset class that maintains characteristics of both fixed income and equity securities. The new PowerShares Convertible Securities Portfolio (CVRT) will seek to replicate the performance of the BofA Merrill Lynch All U.S. Convertibles Index

Use contingent capital to avoid bank bailouts:

Requiring banks to issue contingent capital, which would convert from debt to equity when banks run into trouble, is one way to help avoid bank bailouts in the future, suggests a report released Friday by the C.D. Howe Institute.

IMF Staff Recommends Higher Capital to Address Too-Big-to-Fail

Solving the issues posed by banks deemed too important to fail will require a combination of capital, supervision and resolution measures, an International Monetary Fund staff report says.

Strengthening Bank Regulation: OSFI’s Contingent Capital Plan

Bank of Cyprus Group places 890 M EUR of CoCoCos

The Group's capital adequacy was strengthened with the issue of CoCoCos. According to the Group's announcement dated 20 May 2011 the Bank proceeded with the issue of 890 mn of these securities

Winners give their view on CoCos

A selection of winners of the European Performance Awards give their views on a range of issues from oil markets to the continuing crisis in the eurozone as well as the opportunities in CoCos.

A Matter of Political Will - Room for Debate

This gives financial institutions an opportunity to build reserves. Additionally, contingent capital and debt for equity swaps should be considered.

Big future for hybrid securities

Pimco is launching a fund to focus on cocos and similar instruments

Why contingent convertible bonds may help you keep your money from bailing out banks

Unbeknownst to many people, a relatively new debt instrument is being hotly debated behind closed doors by investors, policy makers and most importantly, by bankers.They are called Contingent Convertible (CoCo) Bonds.

Barclays Will Pay 7% Interest to Senior Employees on Deferred Cash Bonuses

Barclays Plc (BARC) will pay 7 percent interest annually to senior employees on cash bonuses deferred for at least five years under the bank’s plan to link compensation with long-term performance

Contingent convertible (CoCos) bonds: the next big thing?

Deutsche Bank CEO Seeks 12 Billion-Euro Pretax Profit, DZ Says - Bloomberg

OSFI targets bond investor

The federal bank regulator, the Office of the Superintendent of Financial Institutions (OSFI), wants bank-contingent capital in the bond index, and has a plan to achieve this objective. Taking this step would be abusive to bond investors of all kinds, particularly retail investors who have — for the most part quite rightly — become enamoured of indexing their bond portfolios.

Big banks take hit on capital surcharge

The biggest European and US banks are expected to be hit with big surcharges because of their complex structure and global reach, while Chinese and Japanese banks might face lower requirements.The form the surcharge will take is still under discussion. While equity is considered safest, FSB may allow Sifi banks to substitute a larger volume of contingent capital

Basel Committee May Let Banks Use CoCos in Capital Surcharge

Global regulators may allow too-big- to-fail banks to use contingent convertible bonds to meet additional capital requirements designed to save them from collapse in a crisis.

Swisscanto launches CoCo fund