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Why are banks currently holding capital well above the minimum regulatory requirement?
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- How does capital protect a bank from failure? Why are banks currently holding capital well above the minimum regulatory requirement? What are the ways in which a bank can increase its capital ratio?Why do financial regulators have a significant impact on banks?Distinguish between illiquidity and insolvency for banks and discuss the role of capital in protecting against these problems.
- What are the differences between raising capital from a financial institution and raisingfinances directly from the market?“What are the pros and cons of regulating the financial markets and why are certain banks too big to fail?”Commercial banks are often restricted by Central banks to hold sufficient capital. Why is such a restriction given?
- Write methodology of impact of intellectual capital on the performance of SMEs/banks?Provide an explanation of whether it is advantageous for a bank to classify debt investments as “held to maturity “or “available for sale” if the required return by the market declines? What impact will this have on the bank's balance sheet and net income?What are the ways in which a bank can increase its capital adequacy ratio?
- Bank regulators set minimum capital standards to force banks to follow socially desirable policies. True\false. Explainplease view images below c. Does the bank have enough capital to meet the Basle requirements? If not, what minimum Tier 1 or total capital does it need to meet the requirement? d.Discuss the major shortcomings of the Basle I accord.2. If a bank wants to avoid volatility in its regulatory capital, which investment classification would be the most desirable, and which investment classification would be the least desirable? Does your answer differ depending on whether the bank is large or small? In other words, do large and small banks differ on how they can categorize unrealized gains/losses on AFS debt?