A unique feature of the Basle Agreement is that risk weights were applied to each category of assets a bank holds so that riskier banks were forced to hold additional capital in order to protect their depositors.

Question

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The Basle Agreement (Basel I Accord) introduced a risk-weighted framework that required banks to hold capital proportional to the riskiness of their assets, aiming to enhance the stability of the international banking system by ensuring that banks have enough capital to cover losses on their riskier assets.

A Unique Feature of the Basle Agreement Is That Risk