Own funds: Difference between revisions
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imported>Doug Williamson (Amend link.) |
imported>Doug Williamson (Expand. Sources: CRR, Bank of England http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2013/qb130302.pdf) |
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''Bank | ''Bank prudential management.'' | ||
Broadly speaking, in bank funding and capital management, 'own funds' means the bank's own capital. | |||
Own funds are a very stable source of funding, because there is no contractual obligation to repay them. | Own funds are a very stable source of funding, because there is either no contractual obligation to repay them, or only a limited obligation. | ||
Other sources of the bank's funding are 'borrowed' funds. | |||
The Capital Requirements Regulation defines a bank's own funds as the sum of its Tier 1 capital and Tier 2 capital. | |||
In other contexts, the term 'own funds' is used in a narrower sense, limited - for example - to the bank's equity capital. | |||
== See also == | == See also == | ||
* [[Capital]] | |||
* [[Capital Requirements Regulation]] | |||
* [[Equity]] | * [[Equity]] | ||
* [[Funding]] | * [[Funding]] | ||
| Line 18: | Line 26: | ||
* [[Stability]] | * [[Stability]] | ||
* [[Sticky]] | * [[Sticky]] | ||
* [[Tier 1]] | |||
* [[Tier 2]] | |||
Revision as of 12:46, 3 September 2016
Bank prudential management.
Broadly speaking, in bank funding and capital management, 'own funds' means the bank's own capital.
Own funds are a very stable source of funding, because there is either no contractual obligation to repay them, or only a limited obligation.
Other sources of the bank's funding are 'borrowed' funds.
The Capital Requirements Regulation defines a bank's own funds as the sum of its Tier 1 capital and Tier 2 capital.
In other contexts, the term 'own funds' is used in a narrower sense, limited - for example - to the bank's equity capital.
