Bank bond issues look likely

All four major Greek banks are expected, sooner rather than later, to issue Tier 2 bonds, even those which have already done so.
The total value of the bonds will depend on the Single Supervisory Mechanism's setting of Tier 1 capital requirements at the end of the year, but is estimated to come to 2.5 billion euros, including nearly a billion each for Alpha and Piraeus.
Tier 2 capital is supplementary capital and Tier 2 bonds are a form of liability but do not have first claim on assets in the event of a bank liquidation. They are therefore considered a riskier investment.
Even though, at present, the Tier 1 capital of all the "big four" Greek banks (Alpha, Eurobank, National and Piraeus) could absorb the shock of massive sales or debt securitization, they still need to tap the bond market as part of a regulator-imposed obligation to augment their capital.
The...