Europe's biggest banks have been warned they could face a debt buyers' strike by the Association of British Insurers, amid an increasingly bitter feud over controversial changes to their bonds.
ABI members, which include all of the UK's largest insurance groups with over £1trn of assets under management, are among the biggest buyers of bank bonds.
Otto Thoresen, director-general of the ABI, told The Daily Telegraph attempts by banks to force debt investors to accept the terms of their bond exchange offers were "coercive" and could harm the banks' ability to refinance hundreds of billions of pounds of borrowings.
Thoresen claimed banks were using a "thinly veiled threat" not to redeem their junior debt to force subordinated bondholders to accept less attractive terms.
"Such tensions will clearly impact on continuing relationships and raise into question the implications for individual banks' future access to debt capital markets.
"This is an important issue in the light of future capital and debt refinancing requirements for the banking sector in the coming years," said Thoresen.
Barclays Capital analysts reckon Europe's banks must sell about €800bn (£689bn) of new bonds next year, or about €50bn to €70bn every month.
However, the eurozone crisis has led bank issuance to come to a virtual halt since May, creating a huge backlog of debt that needs to be refinanced.
Partner Insight: For Blackfinch, the arrival of its IHT portfolio services was a 'natural evolution' in the group's offering and points to an established track record of returning cash to investors.
Senior Managers Regime
Interest rate outlook unchaged
FCA made demands last week