APRA proposes phasing out AT1 bonds by 2032 to enhance bank capital stability, starting Jan 2027.
The Australian Prudential Regulation Authority (APRA) proposes phasing out Additional Tier 1 (AT1) bonds by 2032 to enhance bank capital stability during crises. Starting January 2027, banks will replace these hybrid securities, valued at $43 billion, with more reliable and cost-effective capital forms. This initiative aims to bolster confidence in the safety of deposits and simplify the capital framework, addressing financial stability risks linked to retail investor ownership of hybrids.
September 10, 2024
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