Tier 1: Difference between revisions
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Tier 1 principally comprises equity, subject to regulatory deductions and the inclusion of some preferred shares and some perpetual bonds. | Tier 1 principally comprises equity, subject to regulatory deductions and the inclusion of some preferred shares and some perpetual bonds. | ||
Tier 1 capital is classified | Tier 1 capital is classified as Common Equity Tier 1 (CET1) or Additional Tier 1 (AT1), CET1 having superior loss-absorbing quality. | ||
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* [[Principal write down]] | * [[Principal write down]] | ||
* [[Subordinated debt]] | * [[Subordinated debt]] | ||
* [[Tier 2]] | * [[Tier 2]] | ||
Revision as of 07:09, 21 November 2016
Banking - capital adequacy
(T1).
Tier 1 is the highest quality capital.
Contrasted with Tier 2, which is of lower quality.
Tier 1 is sometimes known as 'going concern' loss absorbing capital.
Tier 1 principally comprises equity, subject to regulatory deductions and the inclusion of some preferred shares and some perpetual bonds.
Tier 1 capital is classified as Common Equity Tier 1 (CET1) or Additional Tier 1 (AT1), CET1 having superior loss-absorbing quality.
Tier 2 capital comprises eligible long dated subordinated debt.
(Tier 2 is sometimes known as 'gone concern' loss absorbing capital.)
