Capital must be fully paid up or generated internally to the extent of its recognition.
At the time of issuance, it may not:
be directly or indirectly financed by loans granted by the bank to third parties;
be offset against the bank's receivables;
be secured by bank assets.
It must be subordinate to the senior claims of all other creditors in the event of liquidation, bankruptcy or restructuring.
Capital instruments that do not only provide for contingent conversion or write-off at point of non-viability (Art. 29) shall be recognised as capital components commensurate with their characteristics prior to conversion or write-off. This shall be without prejudice to:
recognition to cover the capital buffer requirement under Article 43 paragraph 1 and Annex 8; and
the provisions for the convertible capital of systemically important banks under Title 5.
FINMA shall issue technical implementing provisions on the eligibility of capital.44