The larger a bank the better is its ability to diversify. As a diversified portfolio of assets is a public good, regulators should not limit the size of banks, despite the significant negative externalities failures of large banks tend to impose on the public. Discuss. financial management
Assessment Criteria:
- Demonstrated knowledge of the nature of a bank, financial risks and asymmetric information.
- Logical inferences drawn from information presented and appropriate justification of stance taken.
- Overall presentation of the argument is relevant and appropriate