solution

Which of the statements is incorrect?

A. Failure to meet the capital conservations buffer and the countercyclical buffer guidelines instituted under Basel III will result in limits to special dividends meant to distribute retained earnings to stockholders.

B. Bank regulators set minimum capital standards to protect creditors from managerial fraud or incompetence.

C. Using a strict market value accounting might cause regulators to close banks too early under prompt corrective action requirements.

D. The par value of common shares issued by the bank is included in the Common Equity Tier I capital under Basel III.

E. For the Basel I risk-based capital ratio, the treatment does not include interest rate or foreign exchange risk.