We all depend on the financial system. If there is a failure of a bank, it can lead to large negative impacts that are felt globally. When banks fail, they cannot meet their obligations to depositors or creditors and because of their size and interconnectedness this can cause major negative economic issues. Although banking regulations are different across different regions of the world, at a high level most types of banking regulation can be split into two categories. Prudential regulation and consumer protection. Prudential regulations are the rules and procedures that are designed to protect banks from posing a significant risk to the overall health of the economy. These rules attempt to make sure that banks have the necessary funding to be able to survive economic downturns and also have the risk controls in place and an appreciation of the key risks they face and that they are therefore sufficiently well capitalized. Consumer protection regulation ensures that banks behave in a way that protects the bank's customers. Consumers place a significant amount of trust in banks to look after their savings and banks also offer a wide range of sometimes complex services and products to those consumers who may not be experts. The aim of consumer protection regulation is to ensure that banks act in a way that consumers would expect them to and in the best interests of their clients. Regulators use a mix of supervision and enforcement to protect the economy and the customers of banks. Supervision refers to regulators monitoring the activities of banks to ensure that they are staying within the regulations and is typically carried out on a risk-based approach meaning that the more risk they pose to consumers and the wider economy based on their size, or the complexity, or riskiness of their products and services, the closer the supervisory oversight from regulators. Enforcement refers to the punishments that can be handed out to financial services firms to discourage poor behavior. This might range from fines to bans on certain employees or ultimately a regulator could withdraw a banking regulatory license preventing them from carrying out any banking activities.