// definition
AT1
Additional Tier 1
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Short definition
Additional Tier 1 regulatory capital. Subordinated, perpetual instruments whose distributions can be cancelled and whose principal can be converted or written down under the applicable terms. Tier 1 combines CET1 and AT1, with different loss-absorption mechanisms.
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Knowledge map
Intuition
Cancelling a coupon retains liquidity; conversion or principal writedown absorbs losses under the instrument’s terms.