Question

What are some potential risks to a bank that does not maintain a proper level of regulatory capital?
fines, penalties, and bankruptcy
lower reserve requirements, fines, and higher withdrawals
bankruptcy, higher deposits, and lower reserve requirements
O penalties, higher deposits, and lower credibility

Answer 1

Answer:

Explanation:

C

Answer 2

The potential risks to a bank that does not maintain a proper level of regulatory capital are

• Bankruptcy
• Higher deposits
• Lower reserve requirements.

What is regulatory capital?

Regulatory capital refers to the amount of capital a bank or other financial institution are mandated to hold by its financial regulator.

The purpose of the regulation is to :

1. Increase the level and quality of capital.
2. Enhance risk capture
3. Constrain bank leverage
4. Improve bank liquidity

Hence, the potential risks to a bank that does not maintain a proper level of regulatory capital are bankruptcy, higher deposits, and lower reserve requirements.

Learn more about regulatory capital here : https://brainly.com/question/13676980

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