Tier 1 capital

The going-concern capital of a bank: core equity plus additional instruments that absorb losses while the bank continues to operate.

A bank with ₹5,400 crore of core equity and ₹600 crore of additional instruments holds ₹6,000 crore of tier 1 capital.

The additional layer is perpetual and can have coupons cancelled or principal written down, which several investors discovered was a real feature rather than a theoretical one.

Read the core layer for safety and the total for regulatory compliance. They answer different questions.