3. Capital regulationWhich of the following scenarios would result in a decrease in a bank's capital ratio? Check all that apply.A bank begins backing several different types of loans and investments that it had not backed in the past, such as mortgage-backedsecurities, car loans, and real estate development loans.A bank that has not been performing strongly engages in a secondary stock offering in an attempt to raise $3 million.A bank purchased $5 million worth of stocks one year ago and sells them for $5 million today.A bank that has been performing strongly engages in a secondary stock offering in an attempt to raise $3 million.Basel IThe Basel I framework recommends that banks maintain capital in proportion to which of the following?Risk-weighted assetsLiabilitiesNumber of residential loansMortgage-backed securities Basel IIWhich of the following was done under Basel II guidelines?Revisions were made to the type of analysis banks should do based on the potential of negative economic scenarios.Revisions were made to what assets banks could invest in.Revisions were made recommending that banks maintain a capital conservation buffer of at least 2.5 percent of their risk-weightedassets.Basel IIIRevisions were made to the way credit risk was measured.Which of the following was done under Basel III guidelines?Revisions were made to what assets banks could invest in.Banks' capital ratio requirements began to factor into operational risk.Revisions were made recommending that banks maintain retained earnings and common stock of at least 6 percent of their total risk-weighted assets.Revisions were made to the way banks could acquire risky assets.

The capital ratio of a bank is the percentage of a bank's capital to its risk-weighted assets. A…

Which of the following scenarios would result in a decrease in a bank's capital ratio? Check all that apply. A bank begins backing several different types of loans and investments that it had not backed in the past, such as mortgage-backed securities, car loans, and real estate development loans. A bank that has not been performing strongly engages in a secondary stock offering in an attempt to raise $3 million. A bank purchased $5 million worth of stocks one year ago and sells them for $5 million today. A bank that has been performing strongly engages in a secondary stock offering in an attempt to raise $3 million. Basel I

Which of the following scenarios would result in a decrease in a bank's capital ratio? Check all that apply. A bank begins backing several different types of loans and investments that it had not backed in the past, such as mortgage-backed securities, car loans, and real estate development loans. A bank that has not been performing strongly engages in a secondary stock offering in an attempt to raise $3 million. A bank purchased $5 million worth of stocks one year ago and sells them for $5 million today. A bank that has been performing strongly engages in a secondary stock offering in an attempt to raise $3 million. Basel I

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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