However, the current internal loss absorption requirements (8% of total liabilities and own funds) and limitations on the amount of the resolution funds that can be used (5% of total liabilities and own funds) prevent this, by potentially subjecting senior debt and even unsecured deposits to risks incompatible with financial stability.
Moreover, the decision to establish a wider scope for MREL than for TLAC (Total Loss 3/7  BIS central bankers' speeches  Absorbing Capacity) cannot be ignored.