The capital adequacy ratio of banks and their holding firms rose in the second quarter from three months earlier, data showed Wednesday. The average capital ratio of 20 banks and eight financial holding firms came to 15.76 percent as of end-June, up 0.13 percentage point from three months earlier, according to preliminary data from the Financial Supervisory Service. The capital adequacy ratio is a key gauge of financial soundness by measuring the proportion of a bank's capital against its risk-weighted assets. The banks are required to keep their total capital ratio at 10.5 percent or higher. The financial regulator attributed the on-quarter increase to a "steady" rise in profit for the lenders, noting their combined net profit expanded to 9 trillion won (US$6.76 billion) in the second quarter from 7 trillion won the previous quarter. It said the government will continue to focus on "helping the domestic banks to have sufficient loss-absorbing capacity amid concerns about volatile financial markets." S ource: Yonhap News Agency