Document ID: chunk:federal_register_of_legislation:F2022L01562:body:0:p21
Version: federal_register_of_legislation:F2022L01562
Segment Type: other
Provision Reference: 
Character Range: 54345–57154

assets for Level 2 capital adequacy purposes.
     5. The amount that may be included in the relevant category of Regulatory Capital at Level 2 is:
(a)          the total amount of the category of Regulatory Capital attributable to third parties; less
(b)          any surplus capital amount above the minimum regulatory requirements attributable to third parties.
The amounts above are to be calculated in accordance with paragraphs 6, 7 and 8 of this Attachment.

Common Equity Tier 1 Capital (minority interest)
6.             Minority interest in Common Equity Tier 1 Capital of a Level 2 subsidiary that is eligible to be included in the ADI's Common Equity Tier 1 Capital at Level 2 is calculated as:
(a)          the percentage of all Common Equity Tier 1 Capital of the subsidiary that is attributable to third parties; multiplied by
(b)          the amount of Common Equity Tier 1 Capital of the subsidiary that is used to satisfy the Common Equity Tier 1 Capital PCR and capital conservation buffer requirements under APS 110 at Level 2 arising from exposures held by the subsidiary.[12]

Tier 1 Capital
7.             The amount of capital held under Tier 1 Capital instruments issued by a subsidiary to third parties that may be included in an ADI's Tier 1 Capital at Level 2 is calculated as:
(a)          the percentage of all Tier 1 Capital of the subsidiary attributable to third parties; multiplied by
(b)          the amount of Tier 1 Capital of the subsidiary that is used to satisfy the ADI's Tier 1 Capital PCR and capital conservation buffer requirements under APS 110 at Level 2 arising from exposures held by the subsidiary.[13]

Total Capital
8.             The amount of Regulatory Capital issued by a subsidiary to third parties that may be included in an ADI's Total Capital at Level 2 is calculated as:
(a)          the percentage of Total Capital of the subsidiary attributable to third parties; multiplied by
(b)          the amount of Total Capital of the subsidiary that is used to satisfy the ADI's Total Capital PCR and capital conservation buffer requirements under APS 110 at Level 2 arising from exposures held by the subsidiary.[14]

Attachment D -       Regulatory adjustments

General rules for regulatory adjustments
     1. In determining the size of regulatory adjustments (i.e. deductions) from a category of an ADI's Regulatory Capital, items must be valued on the same basis as the ADI's balance sheet valuations.
     2. For the purposes of deductions to Additional Tier 1 Capital and Tier 2 Capital:
(a)          where the amount of Additional Tier 1 Capital is insufficient to cover the amount of deductions required to be made from this category of capital, the shortfall must be deducted from Common Equity Tier 1 Capital; and
(b)          where the amount