European Banks: Uncertain Future For AT1s
Simon Adamson - Head of Financials, 糖心视频
Paola Biraschi - Head of Southern European Banks, 糖心视频
Puja Karia - Head of Western European Banks, 糖心视频
Jennifer Ray - Head of Northern European Banks, 糖心视频
Feargus Haston - Analyst, Banks, 糖心视频
8 December 2025
Insights into European Banks AT1s Regulatory Reform:
- ECB Task Force Proposals Expected December 11:聽Consequently, the High-Level Task Force will present simplification proposals focusing on capital structure and buffer reforms.
- AT1 Phase-Out Remains Unlikely Near-Term:聽Despite regulatory skepticism, achieving consensus for phasing out the 鈧�220bn AT1 market proves extremely challenging.
- Multiple Regulators Question AT1 Effectiveness:聽Indeed, authorities including Bundesbank, Dutch Finance Ministry, and FSI have expressed concerns about AT1 complexity.
- Buffer Simplification More Probable Than AT1 Reform:聽Therefore, combining capital buffers like CCyB and SyRB appears more feasible than fundamental AT1 restructuring.
- Long Grandfathering Period Would Support Investors:聽Moreover, any eventual phase-out would likely guarantee AT1 redemptions at first call dates through 2035.
Executive Summary
Following APRA’s phase-out of Australian bank AT1s, European regulators have initiated discussions about similar measures. Additionally, Credit Suisse’s failure has intensified regulatory scrutiny of AT1 instruments across European banking systems.
Meanwhile, the ECB Task Force on Simplification prepares to deliver its findings on December 11. Subsequently, market participants anticipate potential guidance regarding AT1 capital’s role within European bank frameworks.
However, proposals to modify certain AT1 features remain under consideration among European regulatory authorities. Nevertheless, achieving broad consensus for comprehensive reforms presents significant challenges across multiple jurisdictions.
Furthermore, any announced phase-out would likely incorporate extended transition periods for existing AT1 instruments. Consequently, outstanding securities might maintain scheduled redemption options at their designated first call dates.
Therefore, regulatory simplification efforts will probably prioritize streamlining capital buffer requirements within banking systems. Ultimately, focus centers on reducing overall complexity in existing capital requirement frameworks.
Fill out the below form to view the full article:
Please note that we can only respond to valid business email addresses and the interview is already available to clients.
Recently Published
Research
AllCovenant-ReviewAutosUS CR Quarterly Q1SovereignsBasicLevFin-InsightsTelecommunicationsMay GMUFinancials糖心视频-ResearchUtilitiesCase Studiesshow-homeshow-initiation page-homeMunicipalsSLRsTMTAsset Management ResourcesPharmaceuticalsJune GMUEnergyResearchGaming/LeisureWebinar Related ResourceIndustrialsPoliticsMediaUS Special Sits OutlookConsumerTariffsSpecial SituationsEuro Autos: Barbarians at the GatesCorporatePrivate CreditAerospace/DefenseU.S. Autos Expert PanelCovenantsBondsReal EstateEU Special Sits OutlookStrategyPost PetitionServicesJuly GMUESGChemicalsIranAsia in Focus 2H26ESG-HomeEmerging MarketsBanksEM OutlookOutlooks-HomeTransportationConstructionEMEA CR Quarterly Q2TechnologyInsuranceAsia in focus webinarUS CR Quarterly Q2ManufacturingEMEA CR Quarterly Q1Global Credit for ME Investors
Energy: Oil Companies Venturing into Venezuela
Energy: Oil Companies Venturing into Venezuela
Read More
US Bankruptcy: Hughes Satellite Systems judge to order examiner appointment to investigate dealings with parent EchoStar; scope of probe subject to further hearing
US Bankruptcy: Hughes Satellite Systems judge to order examiner appointment to investigate dealings with parent EchoStar; scope of probe subject to further hearing
Read More
Thames Water: Rowing Back On Thames?
Thames Water: Rowing Back On Thames?
Read More
NVDA: More Growth, More Commitments