RBNZ wants to limit debt instruments available to meet regulatory capital levels

Fri, 14 Jul 2017

By Paul McBeth July 14 (BusinessDesk) - The Reserve Bank wants to remove certain debt instruments lenders use to raise funds which can then be deemed to meet regulatory capital levels set to avoid the event of a meltdown. The central bank's second options and issues paper on a wide-ranging review of the system's capital framework proposes limiting common equity and preference shares as the only allowable instruments qualifying as Tier 1 capital, and long-term subordinated unsecured debt without triggers that freeze interest payments as T...

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