what is bank capital 
bank capital is the difference between a bank s assets and its liabilities and it represents the net worth of the bank or its equity value to investors the asset portion of a bank s capital includes cash government securities and interest earning loans e g mortgages letters of credit and inter bank loans the liabilities section of a bank s capital includes loan loss reserves and any debt it owes a bank s capital can be thought of as the margin to which creditors are covered if the bank would liquidate its assets 