Criteria | Corporates | General: Update: Intermediate Equity Content For Certain Mandatory Convertible Preferred Stock Hybrids Nov 08
- ID: 1886939
- November 2008
- Standard & Poors
This article announces a change in our equity content categorization of some mandatory convertible preferred stock issued by regulated financial institution and insurance entities. The update follows our review of the performance of mandatory convertible preferred stock issued by rated Australian banks, which are among the most prolific rated issuers of such instruments. Mandatory convertible preferred stock, a form of hybrid capital, is comprised of two elements: (i) An initial security in the form of preferred stock; and (ii) The mandatory conversion (or synthetic equivalent) of the preferred stock into common stock at a specified future date. To facilitate our analysis, we classify qualifying hybrid capital issues into three categories, based on our assessment of their equity content: "high," "intermediate,"...
Companies mentioned in this report are: Australia (Commonwealth of) (Unsolicited Ratings)
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Research Type: Commentary
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