Banking
Bail-in
Bail-in is the resolution mechanism under which a failing bank's losses are imposed on its shareholders and creditors in statutory order rather than on taxpayers. Covered deposits are excluded, while uninsured deposits sit within the creditor hierarchy, generally ranking above ordinary senior unsecured claims.
In plain terms: Instead of a government rescue, the bank's investors and large depositors absorb the loss.
Why it matters
Introduced across major jurisdictions after 2008. For a company, it means a balance above the guarantee limit is not simply safe because the bank is large — it is a claim in a hierarchy, resolved at speed and with a degree of political discretion.
Common misunderstanding
Reading a credit rating as protection. Ratings measure the probability of failure; the resolution regime determines what happens to your balance when one occurs, and the two are not the same question.
Read the full guideDeposit protection and bail-in