BMGT 445 Study Guide - Midterm Guide: Basel Iii, Subordinated Debt, United States Department Of The Treasury

• School: University of Maryland
• Department: Business and Management
• Course: BMGT 445
• Professor: Elinda Kiss

Document Summary

Tier i (core capital)= book value of common equity + perpetual preferred stock + minority interest goodwill. Tier ii (secondary capital) = loan loss reserves (max of 1. 25% of risk-adjusted assets) + various convertible and subordinated debt. Includes preferred stock with fixed maturity & long-term debt with maturities over 5 years. Tier ii claims paid before tier i in liquidation in following order: depositors, general unsecured creditors, subordinated debt, stockholders. 100% cash, united states treasury bills, notes and bonds, and federal reserve bank balances. Tier i cet1 - common shares, retained earnings, accumulated other comprehensive income and other disclosed reserves, minus goodwill. Tier ii subordinated debt & preferred stock, general creditors of the bank. Statutory multifamily mortgage loans, presold residential construction loans, foreign banks. 100% consumer loans, credit cards, commercial loans, corporate exposures, premises, fixed assets, other real estate. 150% high volatility commercial real estate loans; loans in default to sovereigns; and loans that are > 90 days past due.