Manulife Investment Management -Sun, 09/08/2024 - 18:17

ABC of Regulatory Capital

Global credit to the private sector from banks is four times larger than the global non-financial corporate bond market1   
Much of the bank loan universe has not traditionally been available to investors

How has the market landscape changed?

  • Changes to banking regulation have been significant over the last 15 years
  • Banks have had to improve their capital buffers to better withstand future financial turmoil
  • This could affect both their day-to-day business and profitability
  • Initially, banks had limited options – raise equity (potentially expensive and dilutive to shareholders) or reduce lending capacity (risk of losing market share)

1 International Capital Market Association (ICMA).

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