Answer:
The CAMELS ratings is a supervisory rating of the bank's overall
condition used to classify the nation’s banks. This rating is based on
financial statements of the bank and on-site examination by regulators. The
scale is from 1 to 5 with 1 being strongest and 5 being weakest.
The components
of a bank's condition that are assessed- (C) Capital adequacy,
- (A) Asset quality,
- (M) Management,
- (E) Earnings,
- (L) Liquidity and
- (S) Sensitivity to market risk
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