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imported>Doug Williamson |
imported>Doug Williamson |
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| ''Banking.''
| | In loan documentation, a clause with the effect that if a lender suffers a cost or loss in relation to the facility as a result of a change in law or regulation, the borrower should indemnify it. |
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| (CET1).
| | The reasoning is based on the ‘cost plus’ approach to pricing loans. |
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| Common Equity Tier 1 capital.
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| The highest quality form of regulatory capital under Basel III and CRD IV.
| | == See also == |
| | | * [[Gross up]] |
| It includes common equity shares (ordinary shares) and share premium, together with most equity reserves, less regulatory deductions.
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| This capital has the greatest degree of subordination to all other claims on the bank's assets.
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| For this reason, it has the best loss-absorbing capacity and quality from the perspectives of the bank and its supervisors.
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| Sometimes known as Core Equity Tier 1.
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| ==See also== | |
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| * [[Additional Tier 1]]
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| * [[Bank supervision]]
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| * [[Basel II]] | |
| * [[Basel III]]
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| * [[Capital adequacy]]
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| * [[Capital Requirements Directive]]
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| * [[CET1 ratio]]
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| * [[Common equity]]
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| * [[Core Tier 1 capital]]
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| * [[CRD IV]]
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| * [[Equity]]
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| * [[Ordinary shares]]
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| * [[Own funds]]
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| * [[Subordination]]
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| * [[T2]]
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| * [[Tier 1]]
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| * [[Tier 2]]
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| [[Category:Accounting,_tax_and_regulation]]
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| [[Category:Long_term_funding]]
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| [[Category:Identify_and_assess_risks]]
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| [[Category:Manage_risks]]
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| [[Category:Risk_reporting]]
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| [[Category:Financial_products_and_markets]]
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Revision as of 17:09, 25 June 2015
In loan documentation, a clause with the effect that if a lender suffers a cost or loss in relation to the facility as a result of a change in law or regulation, the borrower should indemnify it.
The reasoning is based on the ‘cost plus’ approach to pricing loans.
See also