Paid-up equity capital, Statutory Reserves, and other disclosed free reserves, if any;

Capital reserves representing surplus arising out of sale proceeds of assets;

Innovative perpetual debt instruments eligible for inclusion in Tier 1 Capital which comply with regulatory requirements (limited to 15% of total Tier 1 Capital and excess will be eligible for inclusion under Tier 2 Capital, subject to limits prescribed for Tier 2 Capital).

Elements of Tier 2 Capital (should not exceed 100% of Tier 1 Capital)

Revaluation Reserves

General Provisions and Loss Reserves

Hybrid debt capital instruments

Subordinated Debt

Methods of Measuring Capital Allocation for Credit Risk

Standardised Approach

Foundation Internal Rating Based Approach

Advanced Internal Rating Based Approach (Securitisation Framework)

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* Contributed by: -
Vijay Singh Poonia,
PGDM 2007-09,
IIM Calcutta.