Tier 1 leverage ratio: The tier 1 leverage ratio is a bank’s core capital measured against its assets with no risk weighting applied at all.
How it is calculated
Tier 1 capital over average total assets for leverage capital purposes, as reported on Schedule RC-R. Banks electing the community bank leverage ratio report the same ratio under that framework.
Formula
Tier 1 leverage ratio = tier 1 capital / average total assets
What banks reported in Q2 2026
Across every bank that filed for Q2 2026, the median tier 1 leverage ratio was 10.96%, with the middle half between 9.70% and 13.00%. The right comparison is almost always the row for the bank’s own size rather than the industry line.
| Bank size (total assets) | Bottom quartile | Median | Top quartile |
|---|---|---|---|
| Under $100M | 10.58% | 12.76% | 15.96% |
| $100M - $300M | 9.86% | 11.30% | 13.63% |
| $300M - $1B | 9.61% | 10.81% | 12.58% |
| $1B - $3B | 9.61% | 10.54% | 11.97% |
| $3B - $10B | 9.63% | 10.45% | 11.66% |
| $10B - $100B | 9.43% | 10.25% | 11.08% |
| Over $100B | 7.98% | 9.44% | 10.05% |
Source: BankingLens, computed from FFIEC call reports for the quarter ending June 30, 2026. Quartiles are calculated across the full population of filing banks in each size band, not sampled. Non-insured non-deposit trust companies are left out of every statistic: they take no deposits and make no loans, so a margin or a funding cost computed for them has no meaning.
How to read it
Well capitalized is 5%. The community bank leverage ratio framework, which roughly 44% of banks use in place of the risk based ratios, sets its threshold at 9%, and most banks run between there and the low teens. The bluntness is the point: unlike the risk based ratios it cannot be improved by shifting the balance sheet into assets a model likes, which is why regulators keep it as a floor.
The common mistake. Reading a comfortable ratio as a strong balance sheet. It excludes most accumulated other comprehensive income, so a bank carrying large unrealized securities losses can look fine here and markedly thinner on equity to assets.
Go deeper
- What is a good tier 1 leverage ratio?
- BankingLens pricing and what a subscription adds: percentile rank against the bank’s own FFIEC peer group, fourteen quarters of trend, and the flags an examiner reaches for first.
See also. Tier 1 capital, Community bank leverage ratio, Equity to assets, Risk-weighted assets, Well capitalized.
Every figure on this page is computed from FFIEC call reports for the quarter ending June 30, 2026 and is not modeled, estimated or sampled. This page is generated by _tools/seo/build_glossary.mjs and carries no figure that was typed in. See our methodology and disclaimer. Definitions are general guidance, not regulatory or investment advice.