Under Basel III, banks are allowed to use their internal estimates of borrower creditworthiness to assess credit risk subject to strict disclosure standards.

Name: Under Basel III, banks are allowed to use their internal estimates of borrower creditworthiness to assess credit risk subject to strict disclosure standards.
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Quizplus · Accepted Answer

This is true. Basel III allows for the use of internal models to estimate credit risk, but requires banks to disclose their methods and results to regulatory authorities.

Under Basel III, Banks Are Allowed to Use Their Internal