What is unimpaired capital and surplus?

Paid-in and unimpaired capital and surplus or unimpaired capital and surplus mean shares plus post-closing, undivided earnings. This does not include regular reserves or special reserves required by law, regulation or special agreement between the credit union and its regulator or share insurer.

What is paid-in and unimpaired capital?

(3) “paid-in and unimpaired capital and surplus” means the balance of the paid-in share accounts and deposits as of a given date, less any loss that may have been incurred for which there is no reserve or which has not been charged against undivided earnings, plus the credit balance (or less the debit balance) of the …

What does unimpaired by losses mean?

What does “unimpaired by losses” mean? The term “unimpaired by losses” means that the paid-up capital amount and/or working funds shall be maintained at all times and shall not be impaired by any losses. In the event it is impaired, further capital injection is required to restore it to the required level. Page 2.

What does Tier 1 capital include?

Tier I capital consists mainly of share capital and disclosed reserves and it is a bank’s highest quality capital because it is fully available to cover losses. Tier II capital on the other hand consists of certain reserves and certain types of subordinated debt.

What is the legal definition of unimpaired capital?

Unimpaired Capital means capital on which there is no lien or other charges.

Which is the same as unimpaired capital and surplus?

Unimpaired capital and surplus means the same as “paid-in and unimpaired capital and surplus ,” as defined in paragraph (f) of this section.

What does it mean when a company has impaired capital?

Impaired capital occurs when a firm has experienced losses and the retained-earnings amount is negative, also called a retained deficit. However, unlike the impairment of an asset, impaired capital can naturally reverse when a company’s total capital increases back above the par value of its capital stock.

What is minimum stated unimpaired capital for CIS managers?

In many cases, the financial statements showed that loans which had no contractual obligation are being treated as equity instruments. As such, although the shareholders’ fund is more that MUR 1 million, the stated capital plus retained earnings is less than MUR 1 million.