Which of the following refers to the regulators' policy of allowing an FI to continue operating even when its capital funds are fully depleted?

Question

Quizplus · Accepted Answer

Capital forbearance refers to regulatory policy whereby a financial institution is allowed to continue operating even when its capital funds are depleted. This is done to prevent the failure of the institution and avoid the potential negative impact on the financial system. The regulator may grant capital forbearance if it believes that the institution has the potential for recovery and can make a viable turnaround.

Which of the Following Refers to the Regulators' Policy of Allowing