UK-based building society Nationwide is currently drawing up plans to raise at least £1 billion ($1.5 billion) to fill a hole in its balance sheet.
The Sunday Times reports the company must raise additional capital of £400 million in order to meet a new target set by the financial regulator last week.
Under the new plans, banks must hold core Tier One capital equivalent to seven per cent of their risk-weighted assets.
Banks are also required to have a leverage of at least three per cent, something Nationwide does not currently have. The building society's leverage ratio is now two per cent.
Nationwide chief executive Graham Beale told the Financial Times the leverage ratio is an "unsophisticated measure which ignores the quality of an organisation's assets or its business model".
The Co-operative Banking Group recently revealed its own plans to raise £1.5 billion to plug a capital gap, which will hurt bondholders.
By Claire Archer