September 19, 2017

APRA updated the frequently asked questions (FAQ) on topics related to the capital adequacy requirements for banks and insurers in Australia. The FAQ provide further information to assist regulated entities in the interpretation of Prudential Standard APS 111 Capital Adequacy: Measurement of Capital (APS 111), GPS 112 Capital Adequacy: Measurement of Capital (GPS 112), and LPS 112 Capital Adequacy: Measurement of Capital (LPS 112) with respect to the requirements for Additional Tier 1 Capital and Tier 2 Capital instruments.

The FAQ cover the following issues:

  • Information relevant for APRA’s assessment of the eligibility of capital instruments
  • Minority Interests
  • Conversion requirements for Additional Tier 1 and Tier 2 Capital instruments
  • Cross-default provisions in relation to Additional Tier 1 and Tier 2 Capital instruments
  • Incentives to redeem Additional Tier 1 and Tier 2 Capital instruments
  • Optional Redemption of Additional Tier 1 and Tier 2 Capital instruments
  • Distributions on Additional Tier 1 Capital instruments
  • Marketing of Additional Tier 1 and Tier 2 Capital instruments
  • Use of laws of a foreign jurisdiction in Additional Tier 1 and Tier 2 Capital instruments
  • Default and Winding-up in relation to Tier 2 Capital instruments
  • Mutual Equity Interests

 

Related Link: FAQ

Keywords: Asia Pacific, Australia, Insurance, Banking, FAQ, APS 111, GPS 112, LPS 112, APRA

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