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net capital requirement

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Net capital requirement
SEC requirement that member firms and nonmember securities broker-dealers maintain a maximum ratio of indebtedness to liquid capital of 15 to 1.

net capital requirement
The minimal ratio of cash and assets readily convertible to cash as a proportion of total indebtedness that broker-dealers must maintain. The net capital requirement is set and monitored by the SEC. See also Rule 15c3-1.


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BOSTON GROUP ORDERED TO SHUT DOWN: The Los Angeles-based brokerage firm that took Studio City-based Jerry's Famous Deli public, no longer meets its $250,000 minimum net capital requirement set by regulators due to sharp drops in the stock prices of its IPOs.
Liquidation of individual partnership interests is subject to some constraints, namely: non-compete agreements, deferred payouts over a number of fiscal periods, an aggregate limit on redemptions, minimum capital covenants, and net capital requirements.
We define liquid assets as the sum of (a) corporate cash and cash equivalents, (b) corporate short-term investments, (c) regulatory net capital of (i) our clearing broker-dealer subsidiary in excess of 5% of aggregate debit items and (ii) our introducing broker-dealer subsidiaries in excess of 120% of the minimum dollar net capital requirement or in excess of 8 1/3% of aggregate indebtedness and (d) Tier 1 capital of our trust company in excess of the minimum dollar requirement.
 
 
 
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