APRA says it is satisfied with the big banks' efforts to boost capital reserves as a protection against a future financial crisis.

The big banks have raised billions in recent months – largely through the sale of new shares to investors - after APRA pushed them to increase their capital buffers.

APRA chairman Wayne Byres has told a conference in Sydney that the financial reserves the banks now hold stand up well against their international peers.

“We have a soundly capitalised banking system no question about that,” Byres observed.

“When you look at the risk-based ratios they are as high as they've ever been and capital ratios are only going higher.

“When we put out this international capital comparison study we said there was something of a gap to the top quartile, but the recent round of capital raisings has probably actually closed that gap.”

APRA told the banks to lift their capital adequacy ratios on the back of the recent Financial System Inquiry.

The inquiry recommended increasing reserves against losses to “unquestionably strong” levels.

Capital adequacy ratios are a marker of the financial strength of a bank, and help to work out how much equity a bank has free in the case of an emergency.

The experts say the major banks' key core equity tier one capital ratios are now comfortably in the top half of the spectrum internationally.

But Mr Byres said “unquestionably strong” means more than just higher capital reserves.

He said the big banks must now look to improve their cultures and remuneration practices.

“On culture and remuneration we have more to do before we can be confident that these are genuinely supportive of long-term financial strength [rather] than, as we have seen in the past, possible threats to it,” Mr Byres said.

“While the industry has reduced its reliance on short-term funding, wholesale funding and offshore funding, it has not materially reduced its reliance on the form of funding that is most likely and able to run in a crisis: short-term wholesale funding from offshore.

“Given their funding structures, the largest Australian banks do not easily meet the new standard and, as things stand today, international comparisons are not favourable to them.”