# kaal:claim:1908473-029

**Claim.** Information asymmetries between market participants and a systemically important institution's management before default can be reduced if a financial weakening after conversion of contingent capital triggers a voting rights increase.

**Type.** mechanism  **Support.** argued

**Holds when.**

- Requires that the weakening occur after contingent capital has converted into equity

**Source quote.**

> The information asymmetries between market participants and a SIFI's management before a SIFI defaults199 could be minimized if a financial weakening of the SIFI after conversion of CCS triggers a voting rights increase.

**From.** Wulf A. Kaal, Christoph Henkel, *Contingent Capital with Sequential Triggers* (2011), IV.B. Second Trigger, page 37

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

**Verify.** sha256 of source PDF `9d578dac663357529edd1f6453fcfe69bdc59ac882408d9edfde5a4c2916befa` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20and%20Henkel%20-%202011%20-%20Contingent%20Capital%20with%20Sequential%20Triggers.pdf

**Topics.** disclosure, systemic-risk, risk-and-incentives, governance-design

**Keywords.** information-asymmetry, sifi, default-risk, voting-rights

**Related claims.**

- extended_by: https://wulfkaal.github.io/claims/1998455-032
- extended_by: https://wulfkaal.github.io/claims/1998455-021

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