Under the PCA framework, restriction on the distribution of dividends is a mandatory action at which stage?
- A.Risk Threshold 1
- B.Risk Threshold 2
- C.Risk Threshold 3
- D.Only after the bank is placed under moratorium
Show answer
The first set of mandatory actions, applied as soon as a bank crosses Risk Threshold 1, is a restriction on dividend distribution or remittance of profits, together with a requirement that the promoters, owners or the parent of a foreign bank infuse capital.
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