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COREP Guidance COREP Terms & Definitions CONTACT US What is Common Equity Tier 1 (CET1)?

What is Common Equity Tier 1 Capital (CET1)?


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What is Common Equity Tier 1 Capital?

Common Equity Tier 1 or CET1 primarily consists of ordinary shares, retained earnings and certain reserves. There are no mandatory payments or redemption costs on these capital reserves or instruments. Upon a firm winding-up, ordinary shareholders can only claim for surplus assets once the firm’s depositors and other creditors have been fully imbursed.

Typically the following capital instruments are eligible as CET1:

 See also: What are Eligible CET1 Instruments in UK?