Which of the following is not a weakness of risk-based capital standards?
A) They ignore interest rate risk.
B) They ignore the value of deposit insurance.
C) They ignore changes in the market value of assets.
D) They ignore credit risk.
E) They ignore the value of a bank's charter.

Question

Quizplus · Accepted Answer

Credit risk is actually one of the main factors considered in risk-based capital standards. Therefore, it is not a weakness of these standards. The other choices are all valid weaknesses.

Which of the Following Is Not a Weakness of Risk-Based