Amount Quote by Anat R. Admati
“No business in the economy has the easy money that banks get to play with… The existence of banks with single digit amounts of equity is a completely unhealthy existence -- that is not only a risk for the banks, but for all of us.”
About This Quote
Source Book: The Banker's Paradox, 2020
Banks operate with very low equity, making them risky for the whole economy.
In simple terms: Low capital makes banks fragile.
Key Takeaway
Advocate stronger capital requirements.
Themes
finance
risk
regulation
Mood
cautious
analytical
Type
policy
economic
When to use this quote
- policy making
- investment decisions
- corporate governance
Key Concepts
banking stability
systemic risk
Questions to Reflect On
- Should banks prioritize safety over profitability?
- What alternatives exist to reduce systemic risk?
A Different Perspective
Higher capital may limit lending and growth.
![“Is this complicated, risky [banking] system the best we can have?” quote by Anat R. Admati](https://sms4smile.com/quotes/img-quotes/4b0/anat-r-admati-62764_banking_is-this-complicated-risky-banking-system_157381.jpg)
