capital adequacy
[/ˈkæpɪtəl ˈædɪkwəsi/]
noun
adequação de capital
1. The requirement that financial institutions maintain a minimum level of capital relative to their assets to ensure solvency and absorb potential losses
The central bank implemented stricter capital adequacy ratios to strengthen the banking system.
O banco central implementou índices de adequação de capital mais rigorosos para fortalecer o sistema bancário.
2. A regulatory measure designed to protect depositors and ensure financial stability
Capital adequacy standards are essential for maintaining confidence in the financial sector.
Os padrões de adequação de capital são essenciais para manter a confiança no setor financeiro.
Capital adequacy is a critical regulatory concept in both Brazilian and American banking sectors, particularly post-2008 financial crisis. In Brazil, the Central Bank (Banco Central do Brasil) enforces capital adequacy rules aligned with Basel III standards. The term is used extensively in official regulatory documents, financial reports, and institutional communications. Understanding capital adequacy is essential for banking professionals, investors, and policymakers in both countries.
Related Idioms & Phrases
meet capital adequacy requirements
maintain adequate capital buffers
strengthen capital adequacy ratios
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