Tier 2: Difference between revisions
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(T2). | (T2). | ||
Tier 2 capital | 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 of lower loss-absorbing quality than Tier 1 capital, and its eligible amount for capital adequacy calculation purposes is restricted. | ||
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* [[Going concern]] | * [[Going concern]] | ||
* [[Gone concern]] | * [[Gone concern]] | ||
* [[Hybrid]] | |||
* [[Subordinated debt]] | * [[Subordinated debt]] | ||
* [[T2]] | * [[T2]] | ||
* [[Tier 1]] | * [[Tier 1]] | ||
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).
