capital surplus

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Capital surplus

Amounts of directly contributed equity capital in excess of the par value.

Capital Surplus

Capital a company raises in a financing round in excess of the capital's par value. For example, capital surplus may occur when a publicly-traded company makes a new issue of stock with a par value of $5 per share and places it with investors for $8 per share. Companies can only raise capital surplus on the primary market because they do not receive any additional money from trades on the secondary market. It is important to note that it has become rare for stock to have a par value. See also: Paid-in capital.

capital surplus

References in periodicals archive ?
The Seattle Bank continues to comply with all of its regulatory capital requirements, reporting its seventh consecutive month of risk-based capital surpluses.