Analysis and evaluation of capital adequacy in Latvian banking system

Natalia Konovalova, Snezhana Dalecka
2016 Copernican Journal of Finance & Accounting  
Regulation of banking activity under economic insecurity conditions is one of key problems in our times and is acquiring a particular importance both for banks themselves and their shareholders and also for customers and depositors. Instability of economic situation gives birth to increasing risks faced by world banking system. And therefore in order to ensure reliable operation of commercial banks and prevent their vulnerability to economic insecurity, the supervisory bodies are continuously
more » ... are continuously improving the methods of and approaches towards the management of bank risks accenting a paramount importance of own capital adequacy. A problem of how much capital Latvian commercial banks need to cover their risks remains one of most important in regulation and assessment of banking activity. Meanwhile, the principal direction to improve the capital adequacy ratio is the growth in its flexibility when determining the
doi:10.12775/cjfa.2016.006 fatcat:cigdizobevdq5kdwx5vv5zkpn4