Abstract

The recent financial crisis has amplified calls for the effective regulation of banks. However, an appreciation of bank regulation necessitates an understanding of what a bank is. It is only when that has been accomplished that resources can be channelled towards the regulatory and supervisory objective of those institutions. The major challenge, however, has been the growing difficulty associated with defining what the business of banking is. Statutory definitions have been too restrictive and have confined banks to certain activities. Much as that can be justified as necessary to prevent banks from engaging in other activities, that constraint has had the potential of exposing banks to, among other disadvantages, unfair competition especially given that the activities which have traditionally been the preserve of banks are now being undertaken by non-banking institutions.