In the event that a bank converted previously issued CoCo bonds (contingent convertible debt), then holders of the bonds would change from _____ of the bank.
A) creditors to part owners
B) creditors to debtors
C) debtors to creditors
D) part owners to creditors

Question

Quizplus · Accepted Answer

CoCo bonds are a type of debt instrument that can convert into equity when a predetermined trigger event occurs. This means that if a bank converts previously issued CoCo bonds, the holders of the bonds would change from creditors (debt holders) to part owners (equity holders) of the bank, as they would now hold shares in the bank.

In the Event That a Bank Converted Previously Issued CoCo