Capital Adequacy Ratio


  • A ratio of total capital divided by risk-weighted assets and risk-weighted off-balance sheet items. A bank is expected to meet a minimum capital ratio of 8.0% unless a higher ratio has been specifically prescribed by the Superintendent of Financial Institutions.

minimum asset value, reserved cash

Related Terms and Acronyms

  • Best's Capital Adequacy Relativity Definition,
    • A percentage used to measure a company's relative capital strength as compared to an industry peer composite.
  • Capital Definition,
    • Money that is used to make money; for example, to buy rental property or a business.
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