In the case of a newly incorporated takaful insurer, for the first year of its operation, the takaful fund will be exempt from meeting the required margin of solvency to allow it to build up its capital base. Following this first year, should it not meet the solvency requirements, the CBB expects the shareholders of the takaful firm to cover any shortfall to meeting this requirement by way of an arm's length free loan provided to the takaful fund and meeting the requirements noted in Paragraphs CA-8.4.6 and CA-8.4.7. However, the shareholder fund must meet the minimum Tier 1 capital as defined under Paragraph CA-1.2.1 at all times, including in the first year of operations.