...Strong Global AT1 Issuance in 4Q14 After a seasonal dip in issuance in 3Q14, issue volumes of additional Tier 1 (AT1) bonds recovered strongly in 4Q14 and banks issued over USD29bn of AT1 instruments in the quarter, the second strongest quarter after 2Q14. This brings the total of capital instruments with numerical write-down or conversion triggers included in the Fitch AT1 Tracker to around USD131bn. Issuance in early 2015 remained adequate (around USD1.8bn in January). Chinese Banks Come to the Fore Around 89% of AT1 bonds in 4Q14 were issued domestically and abroad by Chinese banks with several banks (ICBC, Agricultural Bank of China) following Bank of China's USD6.5bn AT1 issue early in the quarter. As a result, as of end 2014, Chinese banks were the third- largest AT1 issuers behind UK and Swiss banks but ahead of other continental European banks. We estimate that Chinese banks will issue in excess of CNY300bn (USD50bn) of AT1 instruments in the short-term, the vast majority of this...
