(18) Net Capital Requirement

ITG Inc. and AlterNet are subject to the SEC’s Uniform Net Capital Rule (Rule 15c3‑1), which requires the maintenance of minimum net capital. ITG Inc. has elected to use the alternative method permitted by Rule 15c3‑1, which requires that ITG Inc. maintain minimum net capital equal to the greater of $1.0 million or 2% of aggregate debit balances arising from customer transactions, as defined. AlterNet has elected to use the basic method permitted by Rule 15c3‑1, which requires that AlterNet maintain minimum net capital equal to the greater of 6 2/₃% of aggregate indebtedness or $100,000. Dividends or withdrawals of capital cannot be made if capital is needed to comply with regulatory requirements.

Net capital balances and the amounts in excess of required net capital at December 31, 2018 for the U.S. Operations are as follows (dollars in thousands):


	Net Capital		Excess
U.S. Operations
ITG Inc.	$	86,683		85,683
AlterNet		5,796		5,696

As of December 31, 2018, ITG Inc. had $5.9 million of cash in a Special Reserve Bank Account for the benefit of customers under the Customer Protection Rule pursuant to SEC Rule 15c3‑3, Computation for Determination of Reserve Requirements and $4.6 million under PABs.

In addition, the Company’s Canadian, European and Asia Pacific Operations have subsidiaries with regulatory capital requirements. The regulatory net capital balances and amount of regulatory capital in excess of the minimum requirements applicable to each business at December 31, 2018, is summarized in the following table (dollars in thousands):


	Net Capital		Excess
Canadian Operations
Canada	$	21,126		20,760
European Operations
Ireland		42,485		17,152
U.K.		1,337		384
Asia Pacific Operations
Australia		30,899		21,818
Hong Kong		2,761		2,223
Singapore		1,156		1,083