Bank regulations are another side of government regulations, which subject banks to certain requirements, restrictions and guidelines. The main objectives of bank regulation and its emphasis, varies between jurisdiction, namely: prudential, system risk reduction, avoiding misuse of banks, to protect banking, confidentially and credit allocation.
Banks that mobilise and allocate savings efficiently, allocate capital to endeavours, with the highest expected business returns, exert sound governance, over funded firms and foster innovation and growth.
Regulation is mostly focused on privacy, disclosure, fraud prevention, money laundering, usury lending and promoting lending to lower-income individuals. These regulations require banks to maintain a minimum reserve that cannot be loaned. The regulation of banks are key elements of a financial safety net.
This book is focused on the rationale for banking regulations. Hopefully, it would be accorded a warm welcome, among all quarters of readership.