Capital Adequacy of Czech Banks

Bc. Renat Ishmukhamedov

Bachelor's thesis

Abstract:

The primary aim of this thesis is to evaluate the capital structure of six leading commercial banks registered in the Czech Republic and to provide a detailed conclusion about the level of their capital adequacy. This paper will evaluate a number of fundamental indicators and ratios that define the level of the capital sufficiency and risk exposure of individual banks. While working on this paper, a special focus was placed on the consequences that implementation of a new international regulatory framework for banks, Basel III, will have on the capital structure and risk management procedures of the banks. As implementation of the new international regulatory framework for banks has been phased in to several steps, this paper will evaluate the elements that have already been implemented and the amendments that are due to be implemented within the next two years.

Keywords

Capital adequacy, exposure, Basel III, Common Equity Tier 1(CET 1) capital, Tier 1 capital, Tier 2 capital, capital conservation buffer, countercyclical buffer, systematically important financial institutions (SIFIs), liquidity coverage ratio, leverage ratio, net-stable funding ratio, loan-to-debt ratio

Language used: English

Date on which the thesis was submitted / produced: 29. 4. 2014

Thesis defence

• Date of defence: 27. 6. 2014
• Supervisor: doc. Ing. Irena Jindřichovská, CSc.
• Reader: doc. RNDr. Petr Budinský, CSc.

University of Finance and Administration

Bachelor programme / field:
Economics and Management / Business Management and Corporate Finance