Why Supervise Banks? The Foundations of the American Monetary Settlement

Why Supervise Banks? The Foundations of the American Monetary Settlement

dministrative agencies are generally designed to operate at arm’s length, making rules and adjudicating cases. But the banking agencies are different: they are designed to supervise. They work cooperatively with banks and their remedial powers are so extensive they rarely use them. Oversight proceeds through informal, confidential dialogue.

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