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3. Capital regulation Which of the following scenarios would result in a decrease in a bank's capital ratio? Check all that apply. A bank sells off many of its assets, such as mortgage-backed securities, mortgage loans, and real estate development loans. A bank that has not been performing strongly engages in a secondary stock offering in an attempt to raise $3 million. O A bank announces that it has increased its dividends from $3.50 per share to $4.50 per share. O A bank announces that it has decreased its dividends from $3.50 per share to $2.50 per share. Basel I According to the Basel I framework, which of the following assets would be given the lowest risk weighting? O Automobile loans O Mortgage-backed securities Commercial mortgage loans O Cash Basel II Which of the following was done under Basel II guidelines? O Revisions were made to the type of analysis banks should do based on the potential of negative economic scenarios. O Revisions were made to the way credit risk was measured. O Revisions were made recommending that banks maintain a capital conservation buffer of at least 2.5 percent of their risk-weighted assets. O Revisions were made to what assets banks could invest in. Basel III Which of the following was done under Basel III guidelines? O Revisions were made to the way banks could acquire risky assets. O Revisions were made recommending that banks maintain retained earnings and common stock of at least 6 percent of their total risk- weighted assets. O Banks' capital ratio requirements began to factor into operational risk. O Revisions were made to what assets banks could invest in

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