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... risk assets nor impacted the capital adequacy ratio, allowing the bank's loan-to-deposit ratio and other indicators to meet regulatory requirements.
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The fundamental purpose of transferring some high-risk credit assets off the balance sheet is to improve the capital adequacy ratio and reduce on-balance-sheet risks, thereby freeing up more lending space.
As everyone knows, domestic banks live on loans; the more they lend out, the higher their profits.
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