Wednesday, 1 February 2023

CAR/CRAR- Capital Adequacy Ratio/ Capital to Risk Weighted Asset Ratio

 

CAR/CRAR- Capital Adequacy Ratio/ Capital to Risk Weighted Asset

Ratio

· RWA- Risk Weighted Assets

 

 

Formulae for CAR=Total Capital

                                     RWA          *100

 

 

Now here, Total Capital= Tier1+ Tier2 capital

CAR/CRAR- Capital Adequacy Ratio/ Capital to Risk Weighted Asset

Ratio

· RWA- Risk Weighted Assets

Formulae for CAR=

                                  RWA*100

Now here, Total Capital= Tier1+ Tier2 capital

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