1. capital adequacy ratio: capital adequacy ratio is an indicator to measure the capital adequacy ratio of a bank, that is, the ratio between its capital and its risk exposure. Basel III stipulates the minimum capital adequacy ratio to ensure that banks have sufficient capital reserves to bear losses when faced with risks and pressures.
2. Leverage ratio: Leverage ratio is an indicator to measure the ratio of bank debt to its capital, which is used to evaluate the leverage risk of banks. Basel III introduces the requirement of leverage ratio, aiming at limiting the risk of excessive leverage of banks and ensuring that banks have sufficient capital reserves to support their business activities.
3. Provision rate: The provision rate refers to the ratio of the loan loss reserve set aside by the bank to the total amount of bank loans. Basel III requires a minimum provision ratio to ensure that banks can properly manage and deal with potential credit risks.
4. liquidity coverage ratio: liquidity coverage ratio is an indicator to measure the liquidity risk management ability of banks, that is, the ability of banks to fulfill their payment obligations when facing liquidity pressure for a period of time. Basel III introduced liquidity coverage ratio requirements to ensure that banks have sufficient liquidity reserves to withstand adverse market changes.