The new Basel Accord may require banks to hold more capital to cover potential losses. By using a value-at-risk approach, researchers found that banks may need larger capital cushions due to increased volatility in minimum capital requirements. The size of the cushion depends on the bank's credit portfolio risk and chosen method for calculating capital requirements. While a more ratings-sensitive approach may lower minimum capital requirements for high-quality credit portfolios, it also requires larger cushions. These findings suggest that the level of capital banks hold post-reform may be influenced by the cushions induced by greater rating sensitivity.