Table 4 demonstrates a way to derive capital requirements for mortgages from loan-to-value (LTV) ratios and borrower credit quality. Starting at the upper left corner of the table, LTV ratios along the left side of the table range from “High” to “Low,” and credit quality across the top of the table ranges from “Low” to “High.” Mortgages assigned to the highest risk-weight category are those with high LTV ratios made to borrowers with low credit quality, as shown in the “Highest Risk” box in the chart. Mortgages assigned to the lowest risk-weight category are those with low LTV ratios made to borrowers with high credit quality, as shown in the “Lowest Risk” box in the chart. The table shows that capital requirements decline as collateral increases; it also shows that capital requirements decline as credit quality improves. Determining risk weights in this way allows for distinction based on both the amount of collateral associated with the loan and the credit quality of the borrowers.