To act in the taxpayer's interest and lower costs to the deposit insurance agency,regulators must

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All three options are necessary for acting in the taxpayer's interest and lowering costs to the deposit insurance agency. Setting tight restrictions on holding risky assets helps to prevent losses and reduce the need for the deposit insurance agency to pay out claims. Imposing high capital requirements ensures that banks have enough cushion to absorb losses and reduces the likelihood of bank failures. Adopting a stance of regulatory forbearance, which is when regulators overlook or delay enforcing regulations, can lead to riskier behavior by banks and increase the likelihood of failures, which ultimately increases costs to the deposit insurance agency and taxpayers. Therefore, all three options are necessary to act in the taxpayer's interest and lower costs to the deposit insurance agency.

To Act in the Taxpayer's Interest and Lower Costs to the Deposit