Comparative Analysis of Sukuk Issuance of US$ Tier 1 Capital Certificates Boubyan Bank and US$ Additional Tier 1 ADIB Capital Invest 1 Ltd

2017 ◽  
Author(s):  
Audia Rahman ◽  
Hayathu Ahamed Hilmy ◽  
Ahmad Hudzaifah
Keyword(s):  
Comparative Analysis ◽  
Tier 1 ◽  
Tier 1 Capital

scholarly journals Are Banks’ Below Par Own Debt Repurchases a Cause for Prudential Concern?

2018 ◽  
Vol 35 (3) ◽  
pp. 501-529
Author(s):  
Martien Lubberink ◽  
Annelies Renders
Keyword(s):  
Fair Value ◽  
Alternative Methods ◽  
Basel Iii ◽  
Regulatory Capital ◽  
Liability Management ◽  
Tier 1 ◽  
Capital Ratios ◽  
European Banks ◽  
Using Data ◽  
Tier 1 Capital

In the lead-up to the implementation of Basel III, European banks repurchased debt securities that traded below par. Banks engaged in these Liability Management Exercises (LMEs) to realize a fair value gain that prudential rules exclude from regulatory capital calculations. The LMEs enabled banks to augment Core Tier 1 capital, given that alternative methods to increase capital ratios were not feasible in practice. Using data of 720 European LMEs conducted between April 2009 and December 2013, we show that poorly capitalized banks repurchased securities and lost about €9.1bn in premiums to compensate their holders. Banks also repurchased the most loss-absorbing securities, for which they paid the highest premiums. These premiums increase with leverage and in times of stress. Hence debt repurchases are a cause for prudential concern.

Part V Liquidity and Leverage, 23 The Leverage Ratio

2018 ◽  
Author(s):  
Gleeson Simon
Keyword(s):  
Leverage Ratio ◽  
Mandatory Requirement ◽  
Tier 1 ◽  
Buffer Requirement ◽  
Basel 3 ◽  
Tier 1 Capital

This chapter discusses the leverage ratio under Basel 3. The leverage ratio was initially implemented as a disclosure standard, with the aim of becoming a mandatory requirement as from 1 January 2018. Basel 3 provides that the original 2014 standard should become binding as a requirement from 2018 to 2021, with the revised Basel 3 requirement taking effect as from 1 January 2022. All banks are required to maintain a leverage ratio of 3 per cent at all times. However, in addition to the 3 per cent requirement, they must also meet a leverage ratio buffer requirement. Both of these requirements must be met with tier 1 capital. The leverage ratio buffer will be set at 50 per cent of a bank's G-SIB buffer.

scholarly journals The Impact of Capital Structure on Economic Capital and Risk Adjusted Performance

2008 ◽  
Vol 38 (01) ◽  
pp. 341-380 ◽  
Author(s):  
Bruce T. Porteous ◽  
Pradip Tapadar
Keyword(s):  
Capital Structure ◽  
Asset Allocation ◽  
Financial Services ◽  
Stochastic Modelling ◽  
Economic Capital ◽  
Tier 2 ◽  
Risky Assets ◽  
Tier 1 ◽  
The Impact ◽  
Tier 1 Capital

The impact that capital structure and capital asset allocation have on financial services firm economic capital and risk adjusted performance is considered. A stochastic modelling approach is used in conjunction with banking and insurance examples. It is demonstrated that gearing up Tier 1 capital with Tier 2 capital can be in the interests of bank Tier 1 capital providers, but may not always be so for insurance Tier 1 capital providers. It is also shown that, by allocating a bank or insurance firm’s Tier 1 and Tier 2 capital to higher yielding, more risky assets, risk adjusted performance can be enhanced. These results are particularly pertinent with the advent of the new Basel 2 and Solvency 2 risk based capital initiatives, for banks and insurers respectively.

scholarly journals Leverage, capital and profitability of the banks: Evidence from Saudi Arabia

Accounting ◽  
2021 ◽  
Vol 7 (6) ◽  
pp. 1363-1370 ◽  
Author(s):  
Abdul Rahman Shaik ◽  
Raj Bahadur Sharma
Keyword(s):  
Control Variable ◽  
Negative Relationship ◽  
Positive Association ◽  
Debt Ratio ◽  
Return On Assets ◽  
Return On Equity ◽  
Total Debt ◽  
Tier 1 ◽  
Equity Ratio ◽  
Tier 1 Capital

The study examines the effect of leverage and capital on the profitability of selected Saudi Arabian Banks during the period 2014 and 2019. The banks have been selected based upon their size in terms of total assets. The profitability elements, such as Earnings per Share (EPS), Return on Assets (ROA), and Return on Equity (ROE) are the dependent variables; Total Debt Ratio (TDR), Tier 1 Capital Ratio (Tier 1 CAP), and Debt to Equity Ratio (DE) are the independent variables, and firm size is the control variable. The study estimates a pooled regression analysis to analyze the effect of these variables. The results of the study show that there is a positive relationship between the different profitability variables and Debt to Equity Ratio. The Total Debt Ratio is having positive association with ROA and ROE, and has an insignificant negative relationship with the EPS, and the Tier 1 capital ratio is having positive association with ROA and ROE, and has an insignificant relationship with the EPS.

Suntrust Banks, Inc.: Coke Refreshes Tier 1 Capital

2017 ◽  
Author(s):  
Mary Margaret Frank ◽  
Sylvie Thompson
Keyword(s):  
Tier 1 ◽  
Tier 1 Capital

The effects of Tier-1 capital, risk management, and profitability on performance of Indonesian Commercial Banks

2018 ◽  
Vol 60 (5) ◽  
pp. 1074-1086
Author(s):  
Erna Sari ◽  
Suhadak Suhadak ◽  
Sri Mangesti Rahayu ◽  
Solimun Solimun
Keyword(s):  
Risk Management ◽  
Commercial Banks ◽  
Research Result ◽  
Equation Modeling ◽  
Content Type ◽  
Tier 1 ◽  
Negative Effect ◽  
Research Findings ◽  
Positive Effect ◽  
Tier 1 Capital

Purpose This research aims to examine the effect of Tier-1 capital, risk management, and profitability on performance of Indonesia commercial banks. Design/methodology/approach The research population consisted of all commercial banks listed in the Indonesia Stock Exchange periods of 2010 to 2014 with a total of 42 companies. The statistical analysis for testing the hypothesis using structural equation modeling (SEM) covariance based using WarpPLS. Findings Research result shows that Tier-1 capital has a positive effect on capital on risk management; risk management has a positive effect on performance, but risk management does not have an effect to profitability; profitability has a positive effect on performance; and Tier-1 capital has a negative effect on profitability. On the other hand, profitability has a negative effect on Tier-1 capital and performance has a positive effect on Tier-1 capital, whereas Tier-1 capital does not have an effect on performance. Originality/value The originality of this research can be seen from the causal relationship between the effects of Tier-1 capital, risk management and profitability on performance of commercial banks in the context of stock performance among Indonesia commercial banks. In addition, previous research findings remain inconsistent between one another. By conducting this research, it is expected that more consistent research findings than the previous ones can be generated. Sluggish global economic conditions which result in declined bank performance are an interesting topic to investigate.

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