kaal:claim:1908473-005

Because policymakers may adopt a suboptimal single trigger design, and because contingent capital has uses at several points in a firm's life cycle, contingent capital securities should be built with sequential triggers rather than one.

Given the risk that policymakers could structure contingent capital rules with a suboptimal trigger design combined with the multiple benefits of using contingent capital in different phases of a company's life cycle, this Article suggests a sequential trigger design for CCS.

Wulf A. Kaal, Christoph Henkel, Contingent Capital with Sequential Triggers (2011), I. INTRODUCTION, p. 11
https://ssrn.com/abstract=1908473 · source PDF

Wulf A. Kaal, Christoph Henkel, Contingent Capital with Sequential Triggers (2011). SSRN: https://ssrn.com/abstract=1908473

• Assumes mandatory issuance of contingent capital securities

designsupport: arguedcontingent-capitaldynamic-regulation

• extended_by kaal:claim:2061166-034 A second, sequential trigger placed before reorganization or resolution cushions the risk that policy makers m...
• extended_by kaal:claim:2957645-006 The issuance of contingent capital securities is a promising dynamic regulatory mechanism that can help addres...
• extended_by kaal:claim:2957645-025 Contingent capital qualifies as a dynamic regulatory mechanism because capital injection is available only if ...

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