The paper discusses how banking regulations like Basel II failed during the 2007-2008 financial crisis. It compares old and new regulations and suggests that banks holding more capital than required could help during economic downturns. The size of this extra capital buffer is crucial for managing risks. The study shows that actual bank capital is influenced by income and losses, while Basel II focuses on credit ratings. The new approach to measuring capital adequacy aligns better with banks' own risk assessments. The paper also touches on political aspects of banking regulations and offers suggestions for improving banking practices post-crisis.