Regulatory uncertainty 'a barrier' to issuance of contingent capital by European insurers
Lack of clarity on Solvency II dampening investor interest, while Swiss insurers reap benefits of stable regime
Uncertainty over the development of Solvency II is preventing European insurers from issuing contingent capital instruments, according to debt capital markets bankers.
The comments come in the wake of a $750 million (£502 million) contingent capital bond issued by Swiss Re.
Contingent capital instruments are generally debt instruments that convert into equity (known as contingent convertible or ‘CoCo' bonds) or are written down once a pre-determined trigger point is reached, such as regulatory
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