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Contingent convertible bond : ウィキペディア英語版 | Contingent convertible bond
A contingent convertible bond is a debt convertible into equity if a pre-specified trigger event occurs. The concept has been particularly discussed in the context of crisis management in the banking industry. It has been also emerging as an alternative way for keeping solvency in the insurance industry. ==The trigger and the conversion rate== A contingent convertible bond is defined with two elements – the ''trigger'' and the ''conversion'' rate. While trigger is the pre-specified event causing the conversion, conversion rate is the actual rate at which debt is swapped for equity. The trigger, which can be bank specific, systemic or dual, has to be defined is a way ensuring automatic and inviolable conversion. A possibility of a dynamic sequence exists – conversion occurs at different pre-specified thresholds of the trigger event. Since the trigger can be subject to accounting or market manipulation a commonly used measure has been the market’s measure of bank’s solvency. The design of the trigger and the conversion rate is critical in the instrument’s effectiveness.
抄文引用元・出典: フリー百科事典『 ウィキペディア(Wikipedia)』 ■ウィキペディアで「Contingent convertible bond」の詳細全文を読む
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