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The Corporate Center segment covers the functions related to the group's operations, its role as the receptacle for the investments portfolio, the subordinated liabilities, and all the other assets and liabilities not allocated to the other business segments.
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There are a few problems with this, not least: (a) the quantum of subordinated debt in the small Spanish banks is not significant, and was recently reduced by the trend of liability management exercises; (b) a not insignificant amount of this subordinated was sold to retail investors.
Why, then, does subordinated debt add discipline?
Foreign policy was subordinated to internal change.
So normal bondholders would be subordinated.
Both of these instincts must be subordinated.
It cannot be subordinated to ethics.
Pornography subordinates women by sexualising their inequality.
Thus, subordinates' OCB will increase.
Liabilities are bigger here.
Pension liabilities will balloon.
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