Govt Exams
Basel III framework comprises CET1, Tier 1, and Tier 2 capital. Tier 3 Capital was part of Basel II but has been eliminated in Basel III. RBI has adopted Basel III norms.
NIM = Net Interest Income / Total Assets. Given NIM of 2.8% and interest income of ₹15,000 cr, net interest income approximates to ₹4,200 crores using the relationship between these metrics.
With 16% CAR (closer to Basel III minimum), and planned lending increase, the bank's capital adequacy becomes the binding constraint for expansion
The Reserve Bank of India (RBI) is the primary regulator responsible for UPI guidelines, digital banking infrastructure, and payment system oversight
Required SLR = 18% × ₹10,00,000 = ₹1,80,000 crore. Actual = ₹1,95,000 crore. Surplus = ₹1,95,000 - ₹1,80,000 = ₹15,000 crore
Under RBI's PCA framework, SCBs with CAR below 8.5% (along with other indicators) trigger supervisory action and corrective measures
When assets grow faster (12%) than NII (8%), it indicates NIM is compressing as the bank is earning lower interest on incremental assets
Higher CAR for a segment indicates higher risk weights assigned. Commercial Advances at 18.5% CAR carries highest risk weighting under Basel III norms
45% Current Ratio against 80% requirement indicates the bank is deficient in liquid assets relative to demand deposits, posing liquidity risk
Share = (₹35,000 / ₹80,000) × 100 = 43.75% of total advances growth came from consumer segment