Banking is regulated primarily to ensure its safety and soundness. The potential importance of bank credit to small-business and community development tempts policymakers to impose additional social and political responsibilities on banks and their regulators.

However admirable their objectives, they should pause before yielding to those temptations. They should first examine regulatory effectiveness in its primary mission more closely.

Limited Time Offer

Save $400 off your subscription. Special offer ends April 30, 2017.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.