Banks Run Into Real Estate Trouble, Political Strife
The Credit Edge by Bloomberg Intelligence
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Exploring Preferred Debt and Risks in the Banking Sector
The chapter delves into the characteristics and benefits of preferred debt, discussing its high yield returns, similarities to equity, and importance as additional tier one capital for banks. It also addresses the current market dynamics and regulatory anticipation regarding preferred debt, along with risks like political changes and potential impacts on long-term rates. The chapter highlights concerns around sovereign risk, commercial real estate, high inflation rates, and private credit growth, emphasizing the implications for the banking sector amidst uncertain political and economic environments.
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