Capital Adequacy In The Romanian Banking System
AbstractThe purpose of this paper is to studying the existing national and internationalcriteria and methodologies related to the banking capitals measurement. We examine theminimum requirements for banking capital and the actual status of Romanian banks in termsof solvency ratio. The paper analyzes the risk-based capital ratios through a case study at thelevel of a banking society from Romania. We quantify the capital charges by reference to theregulatory capital expressed as a percentage of total risk-weighted assets and by reference tothe Tier 1 capital expressed as a percentage of risk-weighted assets. Our research revealsthat the level of capitalization is relevant for the ability of banks to absorb the lossesgenerated by either exogenous shocks induced by the domestic and internationalmacroeconomic environment, or by the inappropriate management of the endogenous risksassociated with banking activity.
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Bibliographic InfoArticle provided by Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia in its journal Annales Universitatis Apulensis Series Oeconomica.
Volume (Year): 1 (2008)
Issue (Month): 10 ()
Contact details of provider:
Solvency Indicators; Adequate Banking Capitalization; Regulatory Capital;
Find related papers by JEL classification:
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
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