Bank Capital Ratios: Risk-Weighted Assets, CET1, Buffers & Leverage
Look up risk weights and build RWA, convert off-balance items with CCFs, assemble CET1, Tier 1 and total capital with deductions, test the ratios against the minimums and buffers, find the distance to the MDA trigger, compute the leverage ratio, plan capital for three years and run a stress scenario, every cell checked. Simplified Basel III-style teaching model.
The first lesson is free — no account needed.
About this course
A bank capital course that measures the capital strength of one fictional bank, Northmere, in a spreadsheet, for bank analysts, risk and treasury staff, FRM candidates and banking students. You look up risk weights by exposure class and calculate risk-weighted assets and the RWA density, convert credit lines, guarantees and letters of credit with credit conversion factors, build CET1, Tier 1 and total capital from equity items and regulatory deductions, test the three capital ratios against the minimums and find the RWA headroom, stack the capital buffers and measure the distance to the MDA trigger, calculate the leverage ratio, project RWA and CET1 over three years with the highest payout that keeps it on target, and chart the trough CET1 ratio in a stress scenario. A simplified Basel III-style teaching model, not a regulatory text, with no affiliation with the BIS or the Basel Committee. The first lab is free.
Lessons
- Risk Weights by Exposure Class & Risk-Weighted AssetsFree
- Off-Balance-Sheet Items: Credit Conversion Factors Pro
- CET1, Tier 1 & Total Capital: Composition and Deductions Pro
- Capital Ratios vs the Minimums: CET1, Tier 1 & Total Pro
- Capital Buffers & the Distance to the MDA Trigger Pro
- The Leverage Ratio: Tier 1 ÷ Exposure Measure Pro
- Capital Planning: RWA Growth vs Retained Earnings over 3 Years Pro
- Stress Scenario: CET1 Depletion and the Trough Ratio (Chart) Pro