Document ID: chunk:federal_register_of_legislation:F2024L01518:body:0:p7
Version: federal_register_of_legislation:F2024L01518
Segment Type: other
Provision Reference: 
Character Range: 17457–20526

Common Equity Tier 1 Capital, is not eligible to be included in the capital conservation buffer.
 3.          Capital distribution constraints apply if an ADI's Common Equity Tier 1 Capital ratio falls within the capital buffer ranges outlined in Table 1 of Attachment B. Capital distribution constraints apply to distributions that affect Common Equity Tier 1 Capital. Items considered to be distributions for these purposes include:
         1.           dividends and share buybacks;[3]
         2.           discretionary payments on Additional Tier 1 Capital instruments;[4] and
         3.           discretionary bonus payments to staff.[5]
 4.          An ADI may apply to APRA to make payments in excess of the constraints imposed by the capital conservation buffer regime. APRA will only grant approval where it is satisfied that an ADI has established measures to raise capital equal to or greater than the amount above the constraint that it wishes to distribute.

Countercyclical capital buffer
 1.          An ADI must hold a countercyclical capital buffer, which must be met with Common Equity Tier 1 Capital, to be calculated in accordance with Attachment C to this Prudential Standard (ADI-specific countercyclical capital buffer).
 2.          APRA will determine the Australian jurisdictional countercyclical capital buffer, that applies from time to time, at a level of between 0 and 3.5 per cent of total RWA.
 3.          APRA will publish any decision to vary the level of the Australian jurisdictional countercyclical capital buffer up to 12 months before the date from which it applies. Any decision by APRA to reduce the level of the Australian jurisdictional countercyclical capital buffer will take effect immediately.
 4.          The ADI-specific countercyclical capital buffer is applied by extending the range of the capital conservation buffer. Capital distribution constraints, as set out in Attachment B to this Prudential Standard, will apply if an ADI's Common Equity Tier 1 Capital ratio falls within the extended capital buffer range (consisting of the capital conservation buffer plus the ADI-specific countercyclical capital buffer).

Minimum dollar amount of capital
 1.          APRA may also determine an ADI's:
         1.           PCR, set by reference to Common Equity Tier 1 Capital, Tier 1 Capital or Total Capital;[6]
         2.           capital conservation buffer; or
         3.           countercyclical capital buffer
as a minimum dollar amount.

Minimum leverage ratio requirement
 1.          An IRB ADI must, at all times, maintain a minimum leverage ratio of 3.5 per cent. APRA may vary the minimum leverage ratio requirement for an ADI.
 2.          An IRB ADI must calculate its leverage ratio in accordance with Attachment D to this Prudential Standard. Where an IRB ADI:
         1.           is a member of a Level 2 group, the minimum leverage ratio requirement will apply only at Level 2; and
         2.           is not a member of a Level 2 group, the minimum leverage ratio requirement will apply