Unlike the accounting capital notes you have, the economic capital measure of capital that should have-to see capital accounting definitions see Capital (economics) -. In finance, primarily for financial services firms, the economic capital is the amount of “risk capital” determined on a realistic basis, that a firm requires to cover the risks est est running or collecting. Refers to the level of capital commensurate with the risks that the institution has-regardless of the existence of assets, is the probabilistic quantification of the amount of potential future losses. The use of a good economic capital model allows senior management to be prepared to anticipate potential problems. It is one of the factors of production that is represented by the goods necessary to produce wealth.
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