S/N | Variables | Acronym | Variable Measurement | |
Dependent Variables | ||||
1 | Stability | STAB | Z-score = (ROA + ratio of equity to total asset)/standard deviation of ROA | |
Basel III regulatory requirements: Independent Variables | ||||
2 | Minimum Capital Requirement | MCR | Minimum ratio of Tier 1 + Tier 2 | |
3 | Capital Adequacy Ratio | CAR | Tier 1 + Tier 2/Risk Weighted Asset | |
4 | Capital Buffer Premium | CBP | Actual capital (core capital plus supplementary capital) less minimum regulatory capital. | |
5 | Liquidity Coverage Ratio | LCR | HQLA/ENCO | |
6 | Prescribed Minimum Capital Requirement | pMCR | As Prescribed by Basel III Accord | |
7 | Prescribed Capital Adequacy Ratio | pCAR | As Prescribed by Basel III Accord | |
8 | Prescribed Capital Buffer Premium | pCBP | As Prescribed by Basel III Accord | |
9 | Prescribed Liquidity Requirements | pLCR | As Prescribed by Basel III Accord | |