The total capital ratio for 28 banks, bank holding companies and Internet-only banks under the Bank for International Settlements (BIS) framework averaged 15.29 percent at the end of June, down 0.23 percentage points from three months earlier, according to the Financial Supervisory Service.
The ratio, a barometer of financial soundness, measures the proportion of a bank's capital to the risk-weight assets. Banks are required to maintain the ratio above 10.5 percent.
The risk-weighted assets increased 2.4 percent on higher corporate loans during the April-June quarter, while capital added 0.9 percent as policy rate hikes expanded losses from the valuation of bond holdings.
The tier-1 capital ratio, which gauges common stock capital and retain earnings, retreated 0.28 percentage points from three months earlier to 13.94 percent at the end of June.
The common equity tier-1 capital ratio, or the proportion of common equity to the risk-weight assets, declined 0.29 percentage points to 12.70 percent in the cited period.
Banks are required to keep the tier-1 and the common equity tier-1 capital ratios above 8.5 percent and 7.0 percent, respectively.
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