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Regulations Governing Securities Firms  CH

Amended Date: 2020.10.29 (Articles 14-6, 21, 32-1, 35-2, 68-1 amended,English version coming soon)
Current English version amended on 2020.02.03 

Title: Regulations Governing Securities Firms(2005.12.28)
Article 60 The net amount of eligible regulatory capital referred to in Paragraph 2 of the preceding Article is the balance of the sum total of the Tier 1 capital and Tier 2 capital items as set out below minus the following items on the balance sheet: financial assets reported at fair value with changes in fair value included in "profit or loss - noncurrent, available-for-sale financial assets - current and noncurrent, held-to-maturity financial assets - current and noncurrent, bond portfolios that include no active market bonds - current and noncurrent, prepayments, special funds, long-term equity investments under equity method, long-term equity investments held for disposal, fixed assets, intangible assets, operating bonds, clearing and settlement funds, refundable deposits, deferred debits, assets leased to others, idle assets, deferred income tax assets - noncurrent, restricted assets - noncurrent:
1. Tier 1 capital: the total of capital stock (common stock, perpetual non-cumulative preferred stock), capital reserve, retained earnings or accumulated losses, unrealized losses on financial products, accumulated translation adjustment, treasury stock, net loss not recognized as pension cost, and the profit/loss of the current year up to the current month.
2. Tier 2 capital: the total of capital stock (perpetual cumulative preferred stock), reserve for trading losses, reserve for losses from breach of contract, unrealized gains on financial products.
Deduction amounts for deductible assets under the preceding paragraph shall be prescribed by the Commission.
Where the amount of Tier 2 capital exceeds that of Tier 1 capital, calculation shall be based on the amount of Tier I capital.