contingent convertible bond
contingent convertible bond (CoCo)
United Kingdom
A form of hybrid security that converts from being a bond (typically subordinated (subordinated loan notes)) into an equity security in the issuer upon the happening of a defined regulatory trigger point, for example, a fall in the issuer's Tier 1 capital. Because of these characteristics, such instruments may also be described as contingent capital instruments. Before conversion, investors receive a coupon payment. Following conversion, the instrument pays dividends.
Related terms

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

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