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Comparison of Capital Adequacy Rules for Credit Institutions and Investment Firms

Author

Listed:
  • Laszlo Seregdi

    (Magyar Nemzeti Bank)

  • Nikolett Kovacsne Bota

    (Magyar Nemzeti Bank)

Abstract

Capital adequacy requirements play a key role in the current prudential regulatory system for the financial sector, both for credit institutions and investment firms. This study summarises how the system of requirements has developed, which elements are similar for credit institutions and investment firms, what the differences are, and what justifies them. It is also examined whether the capital requirement regulatory system for investment firms has become more effective, as a result of the special framework based specifically on the particular risks of investment firms that was developed for them starting in 2021. Finally, the paper also discusses possible directions in which capital requirements regulation may further evolve in these sectors.

Suggested Citation

  • Laszlo Seregdi & Nikolett Kovacsne Bota, 2026. "Comparison of Capital Adequacy Rules for Credit Institutions and Investment Firms," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 25(1), pages 79-99.
    • Handle: RePEc:mnb:finrev:v:25:y:2026:i:1:p:79-99
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    JEL classification:

    • F38 - International Economics - - International Finance - - - International Financial Policy: Financial Transactions Tax; Capital Controls
    • 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
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • N24 - Economic History - - Financial Markets and Institutions - - - Europe: 1913-

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