Capital Requirement
/ˈkæpɪtl rɪˈkwaɪərmənt/
Definitions
- (n.) A regulatory standard mandating the minimum amount of capital a financial institution must hold to cover its risks.
Banks must meet capital requirements to ensure financial stability and protect depositors.
Forms
- capital requirement
- capital requirements
Related terms
See also
Commentary
Capital requirements typically vary by jurisdiction and type of financial institution, often influenced by international banking regulations such as the Basel Accords.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.