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for which of the capital ratios. is risk-weighted asset not used as the denominnator in the...

for which of the capital ratios. is risk-weighted asset not used as the denominnator in the equation ?

common equity tier 1

capital adequacy ratio

tier2 supplemental capital

tier1,core capital

none of items is correct

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Answer #1

Ans capital adequacy ratio

Capital adequacy ratio is risk-weighted asset not used as the denominator in the equation. It is used by central monetary authorities as a tool to ensure adequacy of banks . It also puts constraints on the degree to which a financial company can leverage its capital base.

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