BANKING, CAPITAL ADEQUACY AND NEW ECONOMIC PROGRAM

Banking is an essential aspect for the completion of economic system cycles. To that end, it provides the matching mechanism of fund surpluses and fund deficits. Therefore, ensuring the effective and functional operation of banking is among the main duties of all economic decision makers. The world's experience has developed safety nets in order to ensure the proper functionality of the banking system and with the “the more risk the more capital” approach it provided the rule of capital adequacy starting with Basel Accord at first and continuing nowadays with Basel III. However, the mathematical structure of capital adequacy ratio and the ratio description methods that are given to regulators such as “provisioning” and “risk weighted assets” increase the doubts about realizations of risks being different than the disclosed. Easing, implementation of capital adequacy regulations to boost economic growth may have consequences that will postpone the problems forward.