Dow will drop 50% as market replays 2008, 2000 and 1929. Crowd of people gather outside the New York Stock Exchange following the Crash of 1929. Itâs time to start the countdown to the crash of 2016. No, this is not a prediction of a minor correction. Plan on a 50% crash.
Capital requirement (also known as regulatory capital or capital adequacy) is the amount of capital a bank or other financial institution has to hold as required by its financial regulator.This is usually expressed as a capital adequacy ratio of equity that must be held as a percentage of risk-weighted assets.These requirements are put into place to ensure that these institutions do not take on excess leverage and become insolvent.his is usually expressed as a capital adequacy ratio of equity that must be held as a percentage of risk-weighted assets. These requirements are put into place to ensure that these institutions do not take on excess leverage and become insolvent.
Basel III stipulates that regulatory capital consists of tier 1 and tier 2 capital. Tier 1 capital is the sum of common equity tier 1, which includes shares issued by the bank, and additional tier 1 capital. Tier 2 capital includes, among others, instruments issued by the bank with a minimum maturity of 5 years.hese can be grouped in two capital components: the regulatory capital and the economic capital. From a regulatory point of view, the two components are distinct because while one is subject to external regulation (regulatory capital) the other is determined internally in accordance with macroeconomic conditions.