Regulatory Alerts2014-06-10
Interpretation of Specified Conditions for Issuing Instruments or Shares Ranking as Additional Tier 1 and Tier 2 Capital
The South African Reserve Bank’s Office of the Registrar of Banks interprets the regulatory definition of “associated” to clarify ownership restrictions for instruments or shares ranking as additional tier 1 and tier 2 capital. Under this interpretation, such capital instruments must be held outside the bank or controlling company and their related parties, explicitly excluding external shareholders over whom no control or significant influence is exercised. Institutions must apply this clarification and return a duly completed, dual-signed acknowledgement of receipt to the Registrar alongside their independent auditors.
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