Total Risk Based Capital
The sum of tier 1 plus tier 2 capital. Tier 1 capital consists of common shareholders equity, perpetual preferred shareholders equity with non~cumulative dividends, retained earnings, and minority interests in the equity accounts of consolidated subsidiaries. Tier 2 capital consists of subordinated debt, intermediate~term preferred stock, cumulative and long~term preferred stock, and a portion of a banks allowance for loan and lease losses.
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Split
Procedure where a company increases its number of shares outstanding. After a split, the shares market value will remain unchanged but each share will decline in price. For example, if a firm with 20 million outstanding shares selling at $100 a share executes a 2~for~1 split, it will end up...
