Type 1 capital (capital base - Core capital): Includes funds from the common stock, retained earnings, preferred stock, no permanent accumulation, income from subsidiaries, identified intangible assets excluding to the reputation of the company (bank)
capital type 2 (Supplemental Sung additional capital capital): including loss reserves items from lending and leasing, the subordinated debt capital instruments, debt allows transfer change, medium-term preferred stock, preferred stock, perpetual cumulative dividends not paid, bills of capital and long-term debt capital instruments bearing different characteristics of equity and debt.
In that Tier I is considered more reliable and higher safety
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