Capital Adequacy Ratio Calculator
An educational calculation from reported, already classified figures: see the CET1, Tier 1 and total capital ratios side by side, with each formula, and compare one of them with a target you choose.
An educational calculation from figures you already have: enter reported capital (already classified) and standardized total risk-weighted assets. It doesn't decide eligibility or compliance.
Risk-based capital ratios (educational calculation)
User target scenario (your number), not a regulatory requirement
How the three ratios are calculated
The capital adequacy ratio (CAR) usually means the total capital ratio: (Tier 1 + Tier 2) ÷ RWA. This calculator shows it alongside the CET1 and Tier 1 ratios. Enter reported capital — CET1, AT1 and Tier 2 — and standardized total risk-weighted assets (RWA), all in U.S. dollars. The calculator adds CET1 and AT1 to get Tier 1 capital, adds Tier 2 to get total capital, and divides each by the same RWA. For example, CET1 $80, AT1 $10, Tier 2 $10 and RWA $1,000 give a CET1 ratio of 8.0000%, a Tier 1 ratio of 9.0000% and a total capital ratio of 10.0000%.
Comparing with your own target
Open the target section, choose a ratio and type your own user target as a percentage. The result shows how many percentage points the ratio is above or below that number, using the unrounded ratio, and how much more of that capital layer would reach the target if RWA stayed the same. With CET1 $5,000,000, AT1 $1,000,000, no Tier 2 and RWA $37,000,000, a Tier 1 target of 18% is 1.7838 percentage points away, or $660,000 of additional Tier 1 capital at unchanged RWA. That is arithmetic, not advice on raising or reclassifying capital.
What this calculator doesn't do
It doesn't decide whether capital is eligible, build RWA, apply deductions, pick the rule that applies to an institution, test buffers or leverage ratios, or say whether a bank is well capitalized or compliant. Those depend on the institution, its size and the date. We calculate from figures you provide; this is not a compliance determination.
Method and sources
Amounts are handled as whole cents so there's no rounding drift, and each percentage is rounded once, half up, to four decimal places. The ratio definitions follow the Federal Reserve's Regulation Q §217.10. Sources reviewed September 24, 2026, including the Federal Reserve's 2026 large-bank requirements and the OCC's community bank leverage ratio guide; they're rechecked at least every six months and whenever they change.
Frequently asked questions
What's the difference between CET1, Tier 1 and total capital ratios?
Here, all three divide capital by the same standardized total risk-weighted assets (the standardized approach). The CET1 ratio uses only common equity Tier 1 capital, the highest-quality layer. The Tier 1 ratio adds additional Tier 1 (AT1) capital to CET1. The total capital ratio adds Tier 2 capital as well. Seeing all three together shows how much of a bank's capital sits in each layer.
Why do I have to enter risk-weighted assets myself?
Risk-weighted assets come from applying risk weights to each exposure under the applicable capital rule, which needs a bank's detailed balance sheet and off-balance-sheet data. This calculator doesn't build RWA; it uses the standardized total RWA figure you already have, such as one reported in a regulatory filing.
Why isn't my target a legal test?
Which requirements apply depends on the institution and the date. Large U.S. banks have firm-specific stress capital buffers and global systemically important banks (G-SIBs) carry a surcharge, and some community banks can elect a separate leverage framework instead. The target you enter is simply a number to compare against, so the result never says pass, fail or compliant.
Where can I find the current minimum ratios?
For Fed-regulated institutions, minimum risk-based ratios are in Regulation Q §217.10, linked below; the OCC (12 CFR Part 3) and FDIC (12 CFR Part 324) have parallel rules. Buffers, firm-specific requirements and other frameworks can change what applies to a particular bank, and the rule itself is amended from time to time, so check the official text and the institution's own disclosures rather than treating any single number as a pass line.
Are my figures saved or sent anywhere?
No. The calculation runs in this browser tab. Figures, targets and results aren't saved, added to the page address or sent in analytics; the copy and download buttons only create a receipt when you click them.