▁Equ ity ▁Rec ourse ▁Notes ▁( ER N s ), ▁similar ▁in ▁some ▁ways ▁to ▁cont ing ent ▁convert ible ▁deb t , ▁( Co C os ), ▁should ▁be ▁used ▁by ▁all ▁banks ▁r ated ▁SI FI , ▁to ▁replace ▁non - de pos it ▁existing ▁un sec ured ▁deb t . ▁" ER N s ▁would ▁be ▁long - term ▁b onds ▁with ▁the ▁feature ▁that ▁any ▁interest ▁or ▁principal ▁pay able ▁on ▁a ▁date ▁when ▁the ▁stock ▁price ▁is ▁lower ▁than ▁a ▁pre - spec ified ▁price ▁would ▁be ▁paid ▁in ▁stock ▁at ▁that ▁pre - spec ified ▁price ." ▁Through ▁ER N s , ▁dist ress ed ▁banks ▁would ▁have ▁access ▁to ▁much ▁needed ▁equ ity ▁as ▁willing ▁invest ors ▁purchase ▁tran ches ▁of ▁ER N s ▁similar ▁to ▁pool ing ▁tran ches ▁of ▁sub prime ▁mort g ages . ▁In ▁this ▁case ▁however , ▁the ▁market , ▁not ▁the ▁public ▁takes ▁the ▁ris ks . ▁Bank ing ▁can ▁be ▁pro - cyc lic al ▁by ▁contrib uting ▁to ▁bo oms ▁and ▁b ust s . ▁Str essed ▁banks ▁become ▁rel uct ant ▁to ▁l end ▁since ▁they ▁are ▁often ▁unable ▁to ▁raise ▁capital ▁equ ity ▁through ▁new ▁invest ors . ▁ ▁claim ▁that ▁ER N s ▁would ▁provide ▁a ▁" counter weight ▁against ▁pro - cyc lic ality ." ▁ ▁Resol ution ▁plans ▁The ▁D odd - Fran k ▁Wall ▁Street ▁Reform ▁and ▁Cons umer ▁Prote ction ▁Act ▁requires ▁that ▁bank ▁holding ▁companies ▁with ▁total ▁cons olid ated