Q&A: Christian Clausen on bank capital, systemic risk buffers and bail-in debt

Systemically important banks will be required to hold more capital than their smaller, less-connected rivals – but no-one knows whether the systemic buffer has to be treated as an additional minimum, says Nordea chief executive Christian Clausen. That has big implications for planned recovery and resolution rules, he tells Duncan Wood

Three years after post-crisis reform efforts started in earnest, big questions remain about how the new regime will work, says Christian Clausen, chief executive of Nordea – not least how the new bank capital levels will interact with the embryonic recovery and resolution framework that is supposed to tackle the problem of too-big-to-fail institutions.

In theory, the capital rules reduce the chances of a big bank getting into trouble, while the recovery and resolution regime ensures taxpayers