Question
(i) In Australia, banks have to maintain a capital adequacy ratio (CAR). Explain, in words, why the regulated ADIs must adhere to the capital adequacy
(i) In Australia, banks have to maintain a capital adequacy ratio (CAR).
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Explain, in words, why the regulated ADIs must adhere to the capital adequacy standards. In your answer, provide the figure of the minimum ratio for which banks need to maintain in Australia. (2 marks)
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Which Australian financial regulator monitors banks maintaining this CAR? (1 mark)
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Financial Markets And Institutions
Authors: Jeff Madura
10th Edition
1285531507, 9781285531502
