Non-EEA CoCos

Financial hybrids issued by EEA financial institutions in order to meet Basel III capital requirements are the main subject of this study. These instruments, regulated in detail under CRR and BRRD, were discussed in previous chapters. However, we need to exceed the scope of our study and also focus on the financial hybrids, issued by ‘third’, that is, non-EEA, countries’ issuers for the same purposes of Basel III regulatory capital. The reason behind such study is that almost all CoCos (or ‘Tier 2 CoCos’1) will be listed on Euromarket, and we need to assume that these bonds will be listed on an EEA regulated market or a ‘stock regulated market’ (MTF or OTF).2 Therefore, institutional investors will be able to invest also in non-EEA financial hybrids. This is why at least a brief discussion of that matter is required.