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RBS seeking shareholder approval to issue Cocos

ROYAL Bank of Scotland has confirmed that it is to seek shareholder approval to issue debt that converts into shares if the bank gets into difficulty.

Earlier this week, Barclays' shareholders approved the issuing of equity convertible notes, also known as contingent convertible instruments (Cocos).

Edinburgh-based RBS said it was seeking the power to issue Cocos in response to regulatory requirements for banks to hold more capital and to allow it "to manage its capital in the optimal way".

The part-nationalised bank will hold a general meeting after its annual investor gathering in May, seeking backing for two resolutions that would allow the bank to convert the instruments into equity without necessarily offering shares to existing investors.

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