4.

Select the statement(s) about the risk-based capital requirements under Basel III that is/are CORRECT from the following.

Select one or more:

a. The risk-based capital ratio takes into account the effects of diversification in the credit portfolio.

b. The risk-based capital ratio account for loans made to companies with all of the different credit ratings.

c. A deficiency of the risk-based capital ratio is that it measures the ability of a bank to meet both the on- and off-balance-sheet credit risk, but not interest rate risk or market risks.

d. In evaluating the risk-adjusted asset value of foreign exchange forward contracts, the value of the current exposure can be either positive or zero.