Start learning 50% faster. Sign in now
As a matter of prudence, RBI has stipulated that scheduled commercial banks operating in India shall maintain a minimum total capital (MTC) of 9% of total risk weighted assets (RWAs) i.e., capital to risk weighted assets (CRAR). This will be further divided into different components I. Common Equity Tier 1 (CET1) capital must be at least 5.5% of risk-weighted assets (RWAs) i.e., for credit risk + market risk + operational risk on an ongoing basis. II. Tier 1 capital must be at least 7% of RWAs on an ongoing basis. Thus, within the minimum Tier 1 capital, Additional Tier 1 capital can be admitted maximum at 1.5% of RWAs. III. Total Capital (Tier 1 Capital plus Tier 2 Capital) must be at least 9% of RWAs on an ongoing basis. Thus, within the minimum CRAR of 9%, Tier 2 capital can be admitted maximum up to 2%. IV. If a bank has complied with the minimum Common Equity Tier 1 and Tier 1 capital ratios,then the excess Additional Tier 1 capital can be admitted for compliance with the minimum CRAR of 9% of RWAs. V. In addition to the minimum Common Equity Tier 1 capital of 5.5% of RWAs, banks are also required to maintain a capital conservation buffer (CCB) of 2.5% of RWAs6 in the form of Common Equity Tier 1 capital
Which of the following is the most reactive element in the Periodic table?
Which Indian state boasts the longest coastline?
Between which two rivers was the ancient city of Takshashila located?
In the Mudra Loan Scheme, which type of loan is available for the entrepreneurs?
CriSidEx, India's first sentiment index for micro and small enterprises, was developed by CRISIL in partnership with which organization?
When is National Science Day observed?
What does the second R denote in the “RAFTAAR” scheme of the government of India?
Which committee recommended the establishment of the Central Vigilance Commission?
'Sampark 4.0' is an outreach initiative of which organization?
चीन ने हाल ही में दुनिया की सबसे लंबी हाई-स्पीड रेलवे लाइन-...