[...]We focus here on three types of capital ratios—riskweighted,leverage, and gross revenue ratios. For each ratio, weexamine what makes it actually or potentially useful for bankregulation and we ask whether it is indeed significantly relatedto subsequent bank failure. Perhaps not...

The current review of the 1988 Basel Capital Accord has put the spotlight on the ratios used to assess banks' capital adequacy. This article examines the effectiveness of three capital ratios - the first based on leverage, the second on gross revenues, and the third on risk-weighted assets - in...

The current review of the 1988 Basel Capital Accord has put the spotlight on the ratios used to assess banks’ capital adequacy. This article examines the effectiveness of three capital ratios—the first based on leverage, the second on gross revenues, and the third on risk-weighted...