GK
BANKING AWARENESS AND SEBI
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Tier-II capital consists of
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subordinated debt, hybrid debt capital instruments.
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general provisions, loss reserves and revaluation reserves.
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undisclosed reserves and cumulative perpetual preference shares.
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all of the above
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Explanation:
Detailed explanation-1: -Tier 2 capital – also called ‘supplementary capital’ Undisclosed reserves: These are ‘hidden’ reserves a bank may have created. These reserves generally get created when a bank charges an expense to the P&L which is not going to materialize.
Detailed explanation-2: -The major components of Tier 1 capital are equity share capital, equity share premium, statutory reserves, general reserves, special reserve (Section 36(i)(viii)) and capital reserves (other than revaluation reserves).
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