Assessment of Proper Capital Sufficiency of Regional Commercial Banks

Abstract

Today the role of regional banks of medium size, which have several advantages over large multi-branch banks is increasing, this raises the need to analyze the stability of the regional banking system, at first to assess the adequacy of capital base of regional banks of medium and small size. The article discusses the concept of a regional bank, regional banking system, its institutional structure and level of development, a brief description of the banking system of subjects of the Far Eastern Federal district of the Russian Federation is given. The authors evaluated the adequacy of capital base of small regional banks focused on the needs of their region to determine the possible negative impact of requirements strengthening to the sufficiency from the side of the regulator. The study was conducted on the example of commercial banks registered in the Far Eastern Federal district of the Russian Federation. The calculation results indicate the absence of significant impact of Basel III requirements on capital adequacy in the regional banking system of the Far Eastern Federal district.

DOI: 10.5901/mjss.2015.v6n5s3p71