CAPITAL ADEQUACY Definition

Bookmark and Share

CAPITAL ADEQUACY is a measure of the financial strength of a bank or securities firm, usually expressed as a ratio of its capital to its assets. For banks, there is now a worldwide capital adequacy standard, drawn up by the Basle Committee of the Bank for International Settlements. This ratio requires banks to have capital equal to 8 per cent of their assets.

 

Learn new Accounting Terms

OVERHEAD is the costs associated with providing and maintaining a manufacturing or working environment. For example: renting the building, heating and lighting the work area, supervision costs and maintenance of the facilities. Includes indirect labor and indirect material.

MATURITY is the date on which the last principal payment of a debt instrument becomes due and payable.

Suggest a Term

Enter Search Term

Enter a term, then click the entry you would like to view.