Impaired Capital

1. When a bank's actual assets are worth less than their stated value. When a bank has impaired capital, this capital can be liquidated if the bank cannot make up the deficiency. State laws define the treatment of a bank with impaired capital.

2. When a company’s actual assets are worth less than the stated value of the company’s outstanding shares.

In the case of a bank with impaired capital, one option for making up the deficiency is that the bank's board of directors can choose to levy and collect pro rata assessments on common stock to restore the impaired capital. If stockholders do not pay the assessments within a specified time frame, usually three to four weeks, the bank's board of directors can choose to sell enough of the stockholder's shares to collect the assessment.

Investment dictionary. . 2012.

Look at other dictionaries:

  • impaired capital — When a company s total capital is less than the par value of all its capital stock. Bloomberg Financial Dictionary …   Financial and business terms

  • impaired capital — Condition of a business when the surplus account shows a negative balance and hence the capital is reduced below its value from when the stock was issued (ie. less than the stated or par value of business capital stock) …   Black's law dictionary

  • impaired capital — Fin a company’s capital that is worth less than the par value of its stock …   The ultimate business dictionary

  • capital — Accumulated goods, possessions, and assets, used for the production of profits and wealth. Owners equity in a business. Often used equally correctly to mean the total assets of a business. Sometimes used to mean capital assets. In accounting, the …   Black's law dictionary

  • capital punishment — punishment by death for a crime; death penalty. [1575 85] * * * or death penalty Execution of an offender sentenced to death after conviction by a court of law of a criminal offense. Capital punishment for murder, treason, arson, and rape was… …   Universalium

  • capital and interest — ▪ economics Introduction       in economics, a stock of resources that may be employed in the production of goods and services and the price paid for the use of credit or money, respectively.       Capital in economics is a word of many meanings …   Universalium

  • Capital Area Transportation Authority — Infobox Bus transit name = Capital Area Transportation Authority logo size = image size = image caption = company slogan = Wherever Life Takes You parent = founded = 1972 headquarters = 4615 Tranter Street locale = Lansing, Michigan service area …   Wikipedia

  • Australian Capital Television Pty Ltd v Commonwealth — Infobox Court Case name=Australian Capital Television Pty Ltd v Commonwealth court=High Court of Australia date decided=September 30 1992 full name=Australian Capital Television Pty Ltd Ors v Commonwealth; New South Wales v Commonwealth Anor… …   Wikipedia

  • КАПИТАЛ ОСЛАБЛЕННЫЙ — IMPAIRED CAPITALВ соответствии с пересмотренными законами (Sec. 5205; 12 U.S.C. 55) любой нац. банк, не способный оплатить свой акционерный капитал, а также любой нац. банк, чей акционерный капитал уменьшился из за покрытия убытков или по др.… …   Энциклопедия банковского дела и финансов

  • National Asset Management Agency — Agency overview Formed Late 2009 Jurisdiction Ireland …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.