In order to increase security in equity and debt capital planning, the banking sector has been waiting for a long time for concrete implementation proposals for the MREL specifications. As usual, Basel (here with the corresponding TLAC specifications) sets the direction.
In May 2016 the EU Regulation EU 2016/1450 sets the framewor for the Minimum Requirements for Eligible Liabilities (MRELs), yet the MREL ratio – to be fixed invidually per bank – is still missing for most institutions.
In the current edition of the ALM Forum we give an overview of the concept and the dimension of the MREL requirements and analyze the consequences in the equity and debt capital planning for different types of banks.
We are looking forward to receiving your feedback! Please send your questions and suggestions to Patrick Haas at haas[at]financetrainer.com.