Bank Records
Capital Adequacy and Ratios
Capital Ratios Speak to the Health and Stability of a Bank.
BankProspector tracks three (3) basic bank ratios.
- Capital Adequacy-1 | Tier 1 Capital
- Capital Adequacy-2 | Tier 1 + Tier 2 Capital
- Leverage Ratio
Regulators want the Tier 1 Capital Adequacy ratio to be a minimum of 4%, though there is talk of this going higher. Banks showing a ratio below 4% are deemed to be under capitalized. Tier 1 Capital plus Tier 2 Capital is the more common Capital Adequacy ratio and this number should not be below 8% for a bank to be considered to have sufficient capital. Members can search for banks with insufficient capital ratios by using the advanced search.
The Leverage Ratio minimum is 3%.
