What are the components of tier-1 and tier-2 capital according to Basel accord.

What are the components of tier-1 and tier-2 capital according to Basel accord.

Ans’ In the flowing are given the  components of tier-1 and tier-2 capital according to Basel accord.

Tier-1 (Core capital)	Tier-2 (Supplementary Capital)	Tier-3 ( Additional Supplementary Capital)
1.     Paid up capital. 2.     Non Repayable share premium. 3.     Statutory Reserve. 4.     General Reserve. 5.     Retained Earnings. 6.     Dividend. 7.     Equalization Account.	1.     General Provision. 2.     Assets Revaluation Reserves (up to 50%) 3.     Revaluation Reserves for Securities (up to 50%) 4.     Perpetual Subordinate Debt. (up to 30% of tier-1) 5.     Investment loss offsetting Reserve. 6.     Exchange Equalization account.	Consisting of short term subordinate debt ( original/ residual maturity less than or equal to five years but greater than or equal to two years.

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