ABSTRACT
The primary reasons for bank supervision lie in the fact that, by the very nature of their business, banks are quasi-public institutions; and in the further fact that, at times, some banks have failed to meet their obligations and responsibilities, with serious consequences to the public. Banks are the principal source of commercial credit and of the means of payment ... through which most of the business of the country is carried on. The ability of banks to meet the credit needs of the country has a great and direct influence upon all types of business and productive enterprises and upon the prosperity of the country as a whole. Failures of banks have effects far beyond the immediate fortunes of the individual depositors or borrowers and frequently have disturbing effects beyond the reaches of the immediate territory served by the banks. The banking business, therefore, has long been regarded by the federal government, the states, the public generally, and the bankers themselves, as one that is properly subject to governmental supervision.1
