To be considered adequately capitalized, a bank's minimum Tier 1 capital, total capital, and leverage capital must be:
A) 4%, 8%, and 3%, respectively.
B) 8%, 5%, and 3%, respectively.
C) 10%, 10%, and 10%, respectively.
D) 6%, 10%, and 5%, respectively.
E) 3%, 4%, and 8%, respectively.

Question

Quizplus · Accepted Answer

The regulatory standards for banks typically require a minimum Tier 1 capital ratio of 4%, a total capital ratio of 8%, and a leverage ratio of 3% to be considered adequately capitalized. These ratios are designed to ensure that banks have enough capital to cover their risks.

To Be Considered Adequately Capitalized, a Bank's Minimum Tier 1