Ariel
@Prolotario1
Making It Plain: Purpose of Tier 2 Reserves
• Tier 1 Capital: This is the thick, strong inner wall, made of things like shareholder equity and retained earnings. It’s the first line of defense against financial trouble.
• Tier 2 Capital: This is the second wall, not as strong as the first but still valuable. It’s made of things like undisclosed reserves, subordinated debt, and hybrid capital instruments. Tier 2- A revaluation asset. Which is what the IQD and other foreign currency is considered. Banks are holding meetings to help set up this safety net against the coming currency revaluation that will phase out the fiat currency (USD) by converting your IQD into the US Treasury Bills that the banks will use as reserves.
So you will basically create a financial blanket against the coming Black Swan event when banks will have to weather this storm. So if you happen to have 10-50 million in IQD you just bolstered the reserves of the bank that will do your exchange.
The purpose of Tier 2 reserves, like other elements of Tier 2 capital, is to provide an additional buffer to protect the bank from losses. It acts as a cushion before the bank has to tap into its core capital and potentially affect its ability to lend money.
Here’s a breakdown of some key benefits of Tier 2 reserves:
• Absorb losses: If the bank faces bad loans or other financial difficulties, Tier 2 reserves can be used to absorb those losses before they reach the bank’s core capital. This helps to protect depositors and other creditors.
• Maintain financial stability: By having a strong Tier 2 capital base, banks can weather financial storms more easily and maintain their ability to lend money and support the economy.
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Do you understand your role now? You will be the lifeline of banks going forward. They know this. Which is why they are preparing to serve your best financial interest once the IQD is trading globally on the Forex Market.
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