Banking (prudential standard) determination No. 4 of 2007 - Prudential Standard APS 111 - Capital Adequacy: Measurement of Capital
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Capital
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An ADI must, for capital adequacy purposes, hold the minimum levels of capital required by APS 110. As part of these requirements, an ADI must hold Tier 1 capital as defined in, and to the extent required by, this Prudential Standard. In addition, an ADI may include Tier 2 capital, as defined in this Prudential Standard, as part of its required capital holdings up to the limits specified in this Prudential Standard.
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For the purposes of this Prudential Standard:
(a) a component of capital is any form of capital defined in this Prudential Standard as eligible for inclusion in Tier 1 capital and Tier 2 capital; and
(b) a category of capital is a group of components of capital, namely: Fundamental Tier 1 capital, Residual Tier 1 capital - both Non-innovative Residual Tier 1 capital and Innovative Tier 1 capital, Upper Tier 2 capital and Lower Tier 2 capital, as appropriate.