In effect, this requirement provides a means for “bailing in” a firm’s long-term debt holders so that a taxpayer bailout will be unnecessary. These requirements also should improve market discipline by ensuring that each GSIB has a class of creditors with clear incentive to monitor the firm’s risk-taking.
This is because of a substantial overhauling of the basket with the introduction of a number of new items. For example, the new series has 417 new commodities of which 406 are new manufactured products (Chart 1). Fourth, the new series has wider coverage.