ING Direct 2004 Annual Report Download - page 181

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ING Group Annual Report 2004 179
TIER-1 CAPITAL
The Tier-1 capital is also referred to as the core capital of ING
Bank. It comprises paid up share capital, reserves excluding
revaluation reserves, fund for general banking risks, retained
earnings, third party interest.
TIER-1 RATIO
The Tier-1 ratio is reflecting the Tier-1 capital of ING Bank as a
percentage of its total risk weighted assets. The minimum set
by the Dutch central bank is 4%.
TRADING PORTFOLIO
The trading portfolio comprises those financial instruments
which are held to obtain short-term transaction results, to
facilitate transactions on behalf of clients or to hedge other
positions in the trading portfolio.
TREASURY BILLS
Generally short-term debt certificates issued by a central
government. Dutch Treasury Certificates are regarded as
Dutch Treasury bills.
UNWEIGHTED CREDIT EQUIVALENT
The unweighted credit equivalent is the maximum loss that
ING Group would incur on its derivatives transactions if all its
counterparties defaulted with a margin added in accordance
with internationally accepted criteria.
WARRANT
A financial instrument that gives the holder the right to
purchase ordinary shares.
WEIGHTED CREDIT EQUIVALENT
The weighted credit equivalent is the unweighted credit
equivalent multiplied by the weighting factors determined in
accordance with standards of the international supervisory
authorities. Under certain conditions, the credit risk can be
reduced by entering into bilateral netting agreements.