CORE CAPITAL (TIER-1)
A. Paid up Capital
B. Non-repayable Share premium account
C. Statutory Reserve
D. General Reserve
E. Retained Earnings
F. Minority interest in Subsidiaries
G. Non-Cumulative irredeemable Preference Shares.
H. Dividend Equalisation Account
SUPPLEMENTARY CAPITAL (TIER-2)
A. General Provision maintained against Unclassified loans
B. Assets Revaluation Reserves
C. All other Preference Shares
D. Perpetual Subordinated debt
E. Exchange Equalization Account
F. Revaluation reserves of HTM Securities (Upto 50% of the revaluation reserves)
Note 1: Core Capital must be equal to or more than 5% of the risk-weighted assets.
Note 2: Reserves created by periodic revaluation of banks' assets can be included as a
Component of Tier-2 capital only if the revaluation is formally conducted by
professionally qualified valuation firm. Such reserves will be eligible up to 50% for the
treatment as Supplementary Capital provided that the rationale of the re-valued amount is
duly certified by the external auditors of the bank. Such revaluation may be done once in
a year.
Reference: BRPD Circulars on Capital Adequacy.
