# Bank Leverage

*Macro & Economy — Finicade finance glossary*

How much a bank lends and invests relative to its own capital. High leverage powers profits in good times and makes banks fragile in bad ones — a thin capital cushion is quickly wiped out by losses.

**Related terms:** [Leverage](https://finicade.com/glossary/leverage), [Basel Rules](https://finicade.com/glossary/basel-rules), [Government Debt](https://finicade.com/glossary/government-debt)

**Taught in:** Macro & Markets — Banks, Risk & the Extended IS-LM

Source: https://finicade.com/glossary/bank-leverage