Chapter 17 Risk-Based Assessment of the Capital Adequacy of Commercial Banks *
Author:
William Taylor
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Abstract

The Federal Reserve, together with the other federal banking agencies, has been working for some time on an approach to assessing capital adequacy that takes into account differences in risk profiles among banking organizations. Early last year, U.S. supervisory authorities and the Bank of England jointly issued for comment a risk-based capital proposal applicable to all U.S. and U.K. banking organizations. Action on this proposal was deferred in an effort to enlist the participation of a larger number of countries in the development of a more broadly based international framework.

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