CAR = (Tier 1 Capital + Tier 2 Capital) / Risk- Weighted Assets. It measures how much capital a bank has compared to its risk exposures.
Which one of the following represents capital adequacy ratio for Commercial Banks?
Asked in WBCS Main Paper 5 2022 · Topic: Money & Banking (Banking Sector Reforms: Basel Norms, Asset Quality Review (AQR), and NPA Management)
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Answer: A. Ratio of bank's available capital to risk- weighted assets
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