Document ID: chunk:federal_register_of_legislation:F2023L00684:body:0:p48
Version: federal_register_of_legislation:F2023L00684
Segment Type: other
Provision Reference: 
Character Range: 121792–124651

Includes goodwill and intangibles attributable to investments in subsidiaries, joint ventures and associates. For the purposes of this Prudential Standard, a joint operation (as defined under Australian Accounting Standard AASB 11 Joint Arrangements) is to be treated as a joint venture. ↑
15. Entities that undertake business related to insurance business include entities that provide a financing role to insurance business, insurance intermediaries and service companies. ↑
16. For the purposes of this Prudential Standard, 'reinsurance assets' refers to reinsurance assets as defined in GPS 001, net of doubtful debts. ↑
17. The regulated institution's share of the regulatory capital requirements is determined by applying the ownership percentage of the subsidiary, joint venture or associate (as relevant) to the total regulatory capital requirement of the investment. ↑
18. Examples of the entities that are subject to a comparable regulatory capital requirement are authorised deposit-taking institutions, life companies and health insurers. ↑
19. Charge as defined in the Act. ↑
20. An instrument may be treated as perpetual if it will mandatorily convert to ordinary shares at a pre-defined date after five years from issue. Instruments with maturity dates and automatic roll-over features do not qualify as perpetual instruments. ↑
21. Conversion from a fixed rate to a floating rate (or vice versa) in combination with a call option without any increase in the credit spread is not considered an incentive to redeem. However, the regulated institution must not otherwise do anything to create an expectation that the call will be exercised. ↑
22. An instrument may not provide for investors upon non-payment of a distribution to convert an Additional Tier 1 Capital instrument, and the amount of any unpaid dividend or interest, into ordinary shares or mutual equity interests. ↑
23. This includes where the issue is made in a different jurisdiction. ↑
24. This does not preclude a parent of the regulated institution from holding the instrument where the instrument is directly issued by the regulated institution to the parent. ↑
25. Indirect exposures represent exposures that will result in a loss to the regulated institution substantially equivalent to any loss in the direct holding. ↑
26. For example, by way of a scheme of arrangement. ↑
27. No restrictions on payment of distributions, or any restrictions on redemptions or buyback of Common Equity Tier 1 Capital instruments may be applied to: i) any existing holding company of the issuer or ii) any potential future holding company of the issuer, where the holding company does not undertake the role of the issuer of the instrument. This includes situations where a future holding company may be substituted as the issuer of ordinary shares on conversion, but not substituted as the