Regulatory Alerts2025-09-11
Added · Updated
Capital Adequacy Requirements (CAR) – Guideline (2026)
The guideline establishes capital adequacy requirements for banks, bank holding companies, federally regulated trust and loan companies, and designated systemically important or small and medium-sized deposit-taking institutions. It mandates minimum risk-based capital ratios of 4.5% for Common Equity Tier 1, 6.0% for Tier 1, and 8.0% for Total capital, alongside a leverage ratio. Institutions using internal model-based approaches for credit, counterparty, or market risk are subject to a capital floor with a 67.5% adjustment factor to ensure capital requirements do not fall below standardized approach benchmarks. Specific operational risk calculation methods depend on adjusted gross income thresholds, with institutions exceeding $1.5 billion required to use the Standardized Approach.