Brief
Bank Capital’s Riskiest Bonds Are Pricing Like the Safest
Executive Summary Additional Tier 1, or AT1, bank bonds are trading at near-historic tight spreads despite their complex, loss-absorbing structures. With the ICE CoCo Index offering roughly 206 basis
Summary
Executive Summary Additional Tier 1, or AT1, bank bonds are trading at near-historic tight spreads despite their complex, loss-absorbing structures.
With the ICE CoCo Index offering roughly 206 basis points over benchmark rates, well below its 385-basis-point historical median, investors may not be adequately compensated for coupon-cancellation, extension, and regulatory risks.
As banks increasingly issue... The post Bank Capital’s Riskiest Bonds Are Pricing Like the Safest appeared first
Source
- Connect CREconnectcre.com
