Time is of the essence for banks looking to make good on their TLAC ratios.
But the problem for some is that, while they have been told how many billions of bail-inable bonds they need to print between now and 2019, they are still waiting for the all the groundwork to have been laid out so they can get on with issuing the instruments.
In this respect, Santander’s latest strategy update was a sign of the times. Chasing nearly €30bn of loss-absorbing debt, the Spanish lender said this week that it wasn’t going to wait for Spain to change its laws and help the bank subordinate its senior bonds for TLAC.
Instead Santander is looking to subordinate them itself, using contracts in any new issues that would automatically align instruments with any future legislation transposing the European directive on harmonising insolvency hierarchies into Spanish law.
It is not the first time a European bank has sought to get ahead of the regulators and legal authorities, and make headway with its TLAC programme.
Last April ING issued a tier two instrument from its operating company, adding an option to switch the bonds for a holding company level issue if the group decided it wanted to change its resolution entity (it later decided to do exactly that).
All the debate, admin and legal preparation needed to make the switch from bail-outs to bail-ins is taking a long time in Europe.
But banks are not hanging about waiting for the public sector's ink to dry.