Les fonds propres réglementaires correspondent aux fonds propres que doivent détenir les établissements financiers en lien avec l'exigence réglementaire définie par le Comité de Bâle. Wikipédia
What are the capital adequacy requirements for banks?
The Basel III norms stipulated a capital to risk weighted assets of 8%. However, as per RBI norms, Indian scheduled commercial banks are required to maintain a CAR of 9% while Indian public sector banks are emphasized to maintain a CAR of 12%.
How do you calculate capital adequacy requirement?
The capital adequacy ratio is calculated by dividing a bank's capital by its risk-weighted assets.
What does the term capital adequacy mean?
More specifically, for banks, a capital adequacy ratio is calculated as the amount of capital relative to its 'risk-weighted assets'. Risk-weighted assets, in simple terms, are the loans and other assets of the bank, weighted (or multiplied by a percentage factor) for their respective level of risk of loss to the bank.
What are the capital adequacy requirements under Basel III?
Basel III Capital Adequacy Ratio Minimum Requirement The capital adequacy ratio is calculated by adding tier 1 capital to tier 2 capital and dividing by risk-weighted assets. Tier 1 capital is the core capital of a bank, which includes equity capital and disclosed reserves.