The Paper Enfolds the Management of Risk In Banking Industry Through Maintenance of Adequacy of Capital According To Basel 2 Framework. Basel 2 Is Being Implemented In India Since 2008. the Accord of Basel 2 Enables Bank to Estimate Required Level of Capital For the Banks In Proportion to Their Levels and Areas of Risks. This Further Improves the Financial Soundness of the Banks and Improves Financial Health of the Economy As a Whole.