MetaGlossary.com: Capital Ratio

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Keywords: Downturn, Guaranty, Equity, Statutory, Ratio

Related Terms: Total Assets, Tangible Net Worth, Weighted Average Cost Of Capital, Roce, Economic Value Added, Capital Employed, Working Capital, Total Asset Turnover, Shareholders Equity, Roe, Roa, Return On Total Assets, Return On Invested Capital, Return On Capital, Return On Equity, Return On Assets, Quick Ratio, Net Worth, Net Tangible Assets, Net Current Assets, Net Assets, Liquidity Ratio, Financial Leverage, Debt/Equity Ratio, Current Ratio, Asset Turnover, Acid-Test Ratio, Shareholders' Equity, Profitability Index, Equity Ratio, Debt To Equity Ratio, Acid Test Ratio, Total Debt To Total Assets, Leverage Ratio, Shareholder's Equity, Return On Capital Employed, Debt / Equity Ratio, Nta, Acid Test, Accounting Rate Of Return, Liquidity Ratios, Roic, Capital Adequacy Ratio, Rona, Net Quick Assets, Net Working Capital, Debt-To-Equity Ratio, Leverage Ratios, Debt-Equity Ratio, Solvency Ratio

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Applies to banks and trust companies. Year-end assets divided by year-end total equity (capital plus reserves). A low capital ratio is good. It indicates that a higher proportion of the company's assets are financed by shareholders' equity and reserves (as opposed to debt or deposits), which would make the company stronger in an economic downturn.

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