Any extra cost of capital should be quite limited because the losses from a bail-in resolution are so much smaller than the losses at risk in a liquidation.

Some admire Spain’s system, which requires banks to make extra provision for losses in good times, so that when loans turn sour their profits and thus capital fall by less.

This extra information helps the sender determine that the losses are fairly minimal and that it only needs to retransmit a little bit of data.