1.The concept of own funds used by a Member State may include other items provided that, whatever their legal or accounting designations might be, they have the following characteristics:
they are freely available to the credit institution to cover normal banking risks where revenue or capital losses have not yet been identified
their existence is disclosed in internal accounting records
their amount is determined by the management of the credit institution, verified by independent auditors, made known to the competent authorities and placed under the supervision of the latter. With regard to verification, internal auditing may be considered as provisionally meeting the aforementioned requirements until such time as the Community provisions making external auditing mandatory have been implemented
2.Securities of indeterminate duration and other instruments that fulfil the following conditions may also be accepted as other items:
they may not be reimbursed on the bearer's initiative or without the prior agreement of the supervisory authority
the debt agreement must provide for the credit institution to have the option of deferring the payment of interest on the debt
the lender's claims on the credit institution must be wholly subordinated to those of all non-subordinated creditors
the documents governing the issue of the securities must provide for debt and unpaid interest to be such as to absorb losses, whilst leaving the credit institution in a position to continue trading;
only fully paid-up amounts shall be taken into account.
To these may be added cumulative preferential shares other than those referred to in Article 2 (1) (8).