Work out risk weighted assets instantly with clear inputs, formula shown and shareable results.
Standardised risk weights scale each exposure by its loss risk: zero for own-currency sovereign debt, 35% for residential mortgages, 75% for retail and 100% for unrated corporates. The weighted total drives the capital requirement.
Risk weighted assets
RWA = Σ exposure × risk weight; capital = RWA × 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 a government's own-currency obligations are treated as risk-free under the standardised approach — a much debated assumption.
Large banks may use internal models subject to approval and output floors that limit how far they can diverge.