Which of the following is a disadvantage of wholesale banking?

The choice of complex regulatory compliance as a disadvantage of wholesale banking is accurate because wholesale banks often deal with larger volumes of transactions and more complex financial products compared to retail banks. This complexity leads to a higher level of regulatory scrutiny, as regulators require these institutions to maintain strict adherence to rules meant to prevent financial instability and ensure compliance with financial legislation.

Given the nature of wholesale banking, which involves transactions with other banks, large corporations, and government entities, the regulations are designed to mitigate risks that can have broader implications for the financial system. As a result, the compliance costs can be significant, requiring sophisticated systems for monitoring, reporting, and adhering to various regulations.

On the other hand, limited financial products does not accurately reflect the wholesale banking sector, which typically offers a wider array of complex financial instruments; increased customer trust is generally seen as a positive attribute rather than a disadvantage; and reduced access to technology is not usually a characteristic associated with wholesale banking, as many wholesale banks invest heavily in technology to support their operations.