Work out leverage ratio (basel) instantly with clear inputs, formula shown and shareable results.
The leverage ratio is a non-risk-based backstop: Tier 1 capital over total exposure including off-balance-sheet items. It stops a bank building enormous low-risk-weighted balance sheets on thin capital.
Leverage ratio
Ratio = Tier 1 capital / total exposure measure; maximum exposure = capital / minimum ratio
Figures are estimates based on the inputs given. Bank charges, regulatory minima and market rates change and differ between institutions and jurisdictions. This is not financial advice — confirm with your bank or treasury policy.
Because risk weights can be gamed or simply wrong. The leverage ratio caps total size regardless of modelled risk.
On-balance-sheet assets plus derivative exposures, securities financing and off-balance-sheet commitments.