Meaning of bail-in | Babel Free

Definitions

The process of saving a bank from insolvency by making use of its internal resources (such as client deposits).

Examples

“A “bail-in” process⟳ for bank resolution is a potentially powerful “third option” that confronts this problem head-on. It would give⟳ officials the authority to force⟳ banks to recapitalise from within, using private capital, not public money.”

“Alternatively, where losses are not completely transferred to other creditors, the resolution fund can provide⟳ a contribution to the bank in order⟳ to cover⟳ the losses not absorbed through the bail-in and the capital shortfall, as well as to buy⟳ shares or other capital instruments of the bank under resolution in order⟳ to recapitalise it.”

CEFR level