Among banks’ balance sheet items, regulatory capital ratio has been considered as a new critical variable in the monetary transmission mechanism. During recent years, by means of highlighted role of capital regulation in bank lending and impressive changes in the capital accords, this mechanism has achieved more importance in the international scope. While during the recent years the capital adequacy ratio has been reported in the balance sheet of most private banks, but its effect on bank lending channel and monetary transmission mechanism has not yet been dedicatedly assessed. Hence, in this article, based on seasonal data of banking system, the effect of capital regulation on bank lending channel during 1386:1-1392:2, based on a panel model of banking system in two groups of public and private banks, has been surveyed. The results confirm the effectiveness any of the bank capital - via bank capital adequacy ratio- on both banking groups’ lending decisions. Nevertheless, the results do not confirm in none of banking groups the role of bank capital in the bank lending channel by attenuating monetary policy effect.