as worth 800m in calculating capital 4 years before maturity). The remainder qualifies as senior issuance. For this reason many Lower Tier 2 instruments were issued as 10 year non-call 5 year issues (i.e. final maturity after 10 years but callable after 5 years). If not called, issue has a large step—similar to Tier 1—thereby making the call more likely. Different international implementations Regulators in each country have some discretion on how they implement capital requirements in their jurisdiction. For example, it has been reported that Australia's Commonwealth Bank is measured as having 7.6% Tier 1 capital under the rules of the Australian Prudential Regulation Authority, but this would be measured as 10.1% if the bank was under the jurisdiction of the UK's Prudential Regulation Authority. This demonstrates that international differences in implementation of the rule can vary considerably in their level of strictness. European Union In the EU countries the capital requirements as set out by Basel III agreement have been implemented by the so-called CRD IV package which commonly refers to both the EU Directive 2013/36/EU and the EU Regulation 575/2013. Common capital ratios CET1 Capital Ratio = Common Equity Tier 1 / Credit risk-adjusted asset Value ≥ 4.5% Tier 1 capital ratio = Tier 1 capital / Credit risk-adjusted assets value ≥ 6% Total capital (Tier 1 and Tier 2) ratio = Total capital (Tier 1 + Tier 2) / Credit risk-adjusted assets ≥ 8% Leverage Ratio = Tier 1 capital / Average total consolidated assets value ≥ 3% See also Basel II Basel III Reserve requirement Capital adequacy ratio KVA, the x-Valuation Adjustment for regulatory capital References External links The Basel I Accord FDIC Call and TFR Data Insurance