The larger the bank the better is the 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 larger banks tend to impose on the public ,discuss.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