CTHRepealedLegislation
Insurance (prudential standard) determination No. 7 of 2006 - Prudential Standard GPS 110 - Capital Adequacy
Own instrument purchasesOwn instrument purchases
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Own instrument purchases
- An insurer may not, without obtaining APRA’s prior written approval, enter into an arrangement where it may purchase, or provide financial assistance with a dominant purpose of facilitating the purchase by another party of, its own Tier 1 or Tier 2 capital instruments. Any such purchases will be subject to a limit agreed with APRA. APRA will require an amount of capital equal to that limit to be deducted from Tier 1 or Tier 2 capital as appropriate (depending on whether the prospective purchases relate to Tier 1 or Tier 2 capital instruments).
Limitations
- The amount of Tier 1 and Tier 2 capital included in an insurer’s capital base is subject to the following limits: