5.This Standard explains the requirements for Tier Capital instruments, the application process, and approval procedures followed by the Central Bank. It applies to all local banks operating in the UAE since only local banks are permitted to issue Additional Tier 1 or Tier 2 instruments. Foreign branches, however, are permitted to issue Tier 2 subordinated term loans from their Head Offices restricted to a maximum of 3% of their risk-weighted assets. Banks are responsible for ensuring that their capital instruments comply with all applicable requirements. This Standard will be updated from time to time to reflect relevant regulatory development.