Method statement

Step 1.   Work out the average value, for the income year, of all the * risk - weighted assets of the entity, other than risk - weighted assets attributable to any of the following:

  (a)   the entity's * overseas permanent establishments;

  (b)   assets comprised by the * controlled foreign entity equity of the entity;

  (c)   assets for which * prudential capital deductions must be made by the entity.

Step 3.   Multiply the result of step 1 by the entity's worldwide group capital ratio for that year (see subsection   (3)).

Step 4.   Add to the result of step 3 the average value, for that year, of all the * tier 1 prudential capital deductions for the entity (to the extent that they are not attributable to any of the entity's * overseas permanent establishments or to any * Australian controlled foreign entities of which the entity is an * Australian controller). The result of this step is the worldwide capital amount .

Method statement

Step 1.   Work out the average value, for the income year, of the tier 1 capital (within the meaning of the * prudential standards) of the consolidated group of which the entity is a member (within the meaning of those standards) in accordance with those standards.

Step 2.   Divide the result of step 1 by the average value, for that year, of the * risk - weighted assets of that group in accordance with the * prudential standards. The result is the worldwide group capital ratio .