Structured-Note Ban in FSB Bank-Crisis Rule Has ‘Strong’ Backing
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The Financial Stability Board plans to retain a ban on structured notes in new rules intended to keep taxpayers off the hook when the world’s biggest banks fail, disregarding industry opposition.
An Aug. 24 FSB document on the total loss-absorbing capacity, or TLAC, standards cites a “strong consensus” among regulators to exclude structured notes from the list of eligible liabilities. In a June 4 working paper, the FSB had said admitting the notes was an “option under exploration.”