Seoul (South Korea), September 1: South Korean banks' capital adequacy ratio kept rising for the fourth consecutive quarter in the second quarter, financial watchdog data showed Wednesday.
The total capital ratio of 16 commercial and state-run banks averaged 15.65 percent under the Bank for International Settlements (BIS) framework at the end of June, up 0.29 percentage points from three months earlier, according to the Financial Supervisory Service (FSS).
The ratio, a barometer of financial soundness, gauges the proportion of a bank's capital to the risk-weighted assets. Banks are required to maintain the ratio above 10.5 percent.
The tier-1 capital ratio, which measures common stock capital and retained earnings, gained 0.34 percentage points from three months earlier to 14.29 percent as of the end of June.
The common equity tier-1 capital ratio, or the proportion of common equity to risk-weighted assets, increased 0.27 percentage points to 13.15 percent in the three-month period.
The ratios continued to rise for four straight quarters thanks to faster growth in capital and earnings than the risk-weighted assets.
Banks are required to keep the tier-1 capital ratio and the common equity tier-1 capital ratio above 8.5 percent and 7.0 percent each.
Source: Xinhua