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Donnish Journal of Business and Finance Management Research (DJBFMR)

December 2015 Vol. 1(5), pp. 060-067

Copyright © 2015 Donnish Journals




Original Research Article


Capital Adequacy and Banking Risk in Basel III


Ayub Mohammad

Department of Business Administration (Banking and Finance) International Institute of Paris, France.

Corresponding Author E-mail: ayub_fr@yahoo.com

Accepted 8th November, 2015.



Abstract


Since the financial crisis of 2008, banking supervision has been a core activity in all banks governed by supervisory committees all over the world. The Pakistan’s banking system is not an exceptional case. The State bank of Pakistan is required to open the foreign direct investment along with tight banking policies in order to assess the bank’s performance through capital adequacy ratio which would be a useful tool for controlling the banking system. This paper has been presented to look at the relationship between the extent of capital adequacy, risk factor and profitability signs in Pakistanis commercial banks via theoretical and empirical study. State bank provides the adequate dissemination on regulations, Basel accord, and bank information is provided. Use the panel data sets of banks from Pakistan and USA over the period 2004 – 2014 and by following the bank specific variables, capital adequacy ratio, bank size, return on assets, liquidity risk, leverage, management quality and macroeconomic variables, GDP, Inflation, which have significant impact on bank efficiency and performance.

Keywords: Capital adequacy, Macroeconomics factors, Commercial banks, Bank variables.

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Cite This Article:

Ayub Mohammad. Capital Adequacy and Banking Risk in Basel III. Donnish Journal of Business and Finance Management Research 1(5) 2015 pp. 060-067.


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