Under Basel III regulatory rules, banks that eld "significant" investments in other financial groups (classified as more than 10 per cent of their total equity) woud have to hold more capital against these investments. Specifically, the investments in excess of 10 per cent threshold were to be excluded in the calculation of Tier I capital.l

This new rule made it more expensive for banks to hold investments in other banks. It trapped capital on the balance sheet and could force banks to shrink if they chose to dump these investments. Holding more capital against these investments, on the other hand, would cause a bank's returns to decline and might also hurt share prices.

Because Standard Chartered held significant investments in the Agricultural Bank of China ($621 million), PT Bank Permata ($638 millio), Vietnam's Asia Commercial Joint Stock Bank ($105 million) and China Bohhai Bank ($123 million), it would have to raise funds equivalent to the total excess investments in these financial institiutions. Thus, SCB might find it unattractive to hang on to these bank investments.

Assumig Standard Chartetered decided to hold these bank investments and to raise funds to satisfy the higher capital requirement, what could be some possible financial alternatives?