When undercapitalized banks raised new capital in response to a uniform capital requirement in 1981, what other action(s) did they take which tended to offset the advantage of added capital?
A) increased off-balance sheet activities.
B) reduced service prices.
C) made riskier loans.
D) a and b
E) a and c
Correct Answer:
Verified
Q45: From a regulator's viewpoint, greater variability of
Q46: Regulatory forbearance caused losses to increase with
Q47: The capital adequacy decision is a trade-off
Q48: The Form for Analyzing Bank Capital (FABC)
Q49: In 1981 federal bank regulators moved to
Q51: Historical evidence in banking has indicated that:
A)
Q52: Under the current risk-based capital requirement, total
Q53: Tier 1 capital does NOT include which
Q54: When a distressed bank situation arises, which
Q55: Increased use of debt, holding all else
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents