I just wanted to clarify how regulatory capital requirements are calculated. From my understanding, your total assets should be:
$$Total \space Assets = Provisions \space + \space Available \space capital = (Best \space Estimate \space + Margins) + (Capital \space required + Free \space Assets )$$
Is the minimum capital requirement (MCR) just margins + capital required? And Solvency capital required simply margin + capital required, but the capital required is slightly larger.
I've also noticed that when they talk about regulatory capital, there is some inconsistency. Sometimes they refer to it as MCR + Free Assets, but other times they refer to it as: Equity + retained profit+ preference shares + subordinated debt.
I am just confused with all these terms