Risk-Based Capital Requirements
/ˈrɪsk beɪst ˈkæpɪtl rɪˈkwaɪərmənts/
Definitions
- (n.) Regulatory standards requiring financial institutions to hold a minimum amount of capital proportional to the riskiness of their assets.
Banks must maintain risk-based capital requirements to protect against potential losses.
Forms
- risk-based capital requirements
- risk-based capital requirement
Related terms
See also
Commentary
Typically used in banking and insurance regulation to ensure solvency; often calibrated under international frameworks like 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.