Murabaha and Tier 2: Difference between pages

Revision as of 13:28, 10 November 2016

Banking - capital adequacy.

(T2).

Tier 2 capital includes eligible long dated subordinated debt and certain hybrid instruments.

Tier 2 is of lower loss-absorbing quality than Tier 1 capital, and its eligible amount for capital adequacy calculation purposes is restricted.

Tier 2 is sometimes known as 'gone concern' loss absorbing capital.

It is generally loss-absorbing only when a bank has reached the point of non-viability (PONV).

@@ Line 1: / Line 1: @@
-''Islamic finance''
+''Banking - capital adequacy.''
-Murabaha is a sharia-compliant financing arrangement under which a bank buys an asset and sells it on to the customer at an agreed mark-up.  The customer, who could not otherwise afford to buy the asset, pays in instalments.
+(T2).
+Tier 2 capital includes eligible long dated subordinated debt and certain hybrid instruments.
-Murabaha is sometimes known as 'cost plus financing'.
+Tier 2 is of lower loss-absorbing quality than Tier 1 capital, and its eligible amount for capital adequacy calculation purposes is restricted.
+Tier 2 is sometimes known as 'gone concern' loss absorbing capital.
+It is generally loss-absorbing only when a bank has reached the point of non-viability (PONV).
 == See also ==
-* [[Islamic finance]]
+* [[AT1]]
-* [[Sukuk]]
+* [[Basel II]]
+* [[Basel III]]
+* [[Capital]]
+* [[Capital adequacy]]
+* [[Capital Adequacy Directive]]
+* [[CET1]]
+* [[CRD IV]]
+* [[Equity]]
+* [[Going concern]]
+* [[Gone concern]]
+* [[Hybrid]]
+* [[Subordinated debt]]
+* [[T2]]
+* [[Tier 1]]