Glossary

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Term Definition Legal instruments

tier 1 capital

01/01/2016

THIS DEFINITION ONLY APPLIES TO THE LEVERAGE RATIO PART

has the meaning given by Article 25 of the CRR except that:

(1) an additional tier 1 capital instrument can only be counted as tier 1 capital if it either:

(a) converts into common equity tier 1 capital; or

(b) writes down,

when the common equity tier 1 capital ratio of the firm falls below a level equal to either:

(a) 7%; or

(b) a level higher than 7%,

as specified in the provisions governing the instrument; and

(2) instruments that qualify for grandfathering under Article 483 of the CRR can be counted as tier 1 capital.