Bank investors still don’t think bail-in will happen, FSB told
Questions over bailing in bank bondholders mean problem of too big to fail persists, experts warn
Investors in bank debt still assume governments would bail out a large bank rather than bail in bondholders, a global watchdog has been warned by analysts and former regulators.
“The market thinks you will still blink when it comes to it,” said Paul Tucker, chair of the Systemic Risk Council, which focuses on the US and Europe. He was addressing a virtual workshop on September 4 organised by the Financial Stability Board.
Tucker, a former deputy governor for financial stability at the Bank of
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