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    Question

    What is the expected Common Equity Tier 1 (CET1) capital

    improvement range for banks under the revised Basel III norms?
    A 20–70 basis points Correct Answer Incorrect Answer
    B 5–25 basis points Correct Answer Incorrect Answer
    C 15–40 basis points Correct Answer Incorrect Answer
    D 10–50 basis points Correct Answer Incorrect Answer
    E 30–60 basis points Correct Answer Incorrect Answer

    Solution

    According to IIFL Financials and other sources, the proposed cut in risk weights—especially for MSME and residential mortgage loans—is anticipated to lead to a 10–50 basis points (bps) improvement in CET1 capital for banks. This change enhances the capital position of banks and encourages more credit to key sectors.

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