Minimum capital is a concept used in corporate law and

banking regulation Bank regulation is a form of government regulation which subjects banks to certain requirements, restrictions and guidelines, designed to create market transparency between banking institutions and the individuals and corporations with whom the ...

to stipulate what assets the organisation must hold as a minimum requirement. The purpose of minimum capital in corporate law is to ensure that in the event of insolvency or financial instability, the corporation has a sufficient equity base to satisfy the claims of creditors.

Corporate law

All public companies within the

European Union The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been de ...

are required to hold at least €25,000 in capital, although many countries go above this minimum requirement. The requirement is e.g. £50.000 in the United Kingdoms (England and Wales), of which at least 25% must be paid up (of the nominal amount and of any premium).

Banking regulation

Basel II Basel II is the second of the Basel Accords, which are recommendations on banking laws and regulations issued by the Basel Committee on Banking Supervision. It is now extended and partially superseded by Basel III. The Basel II Accord was publ ...

Capital Requirements Directive The Capital Requirements Directives (CRD) for the financial services industry have introduced a supervisory framework in the European Union which reflects the Basel II and Basel III rules on capital measurement and capital standards. Member St ...

* Leverage (finance)

References

*J Armour, 'Legal Capital: An Outdated Concept?' (2006
7 EBOR 5

External links

Capstone Capital Group
{{DEFAULTSORT:Minimum Capital United Kingdom company law Capital requirement

Corporate law

Banking regulation

See also

References

External links