A bank audit is a comprehensive examination of a bank's financial statements, internal controls, risk management, and compliance with regulations. Independent auditors go through every major account, transaction, and process to verify that the bank's numbers are accurate and its operations are sound.
Banks face multiple types of audits: statutory audits (required by law), internal audits (by the bank's own team), regulatory audits (by central banks like the RBI or Fed), and concurrent audits (real-time checks on daily transactions). It is one of the most heavily audited industries in the world.
Why so many audits? Because banks hold public money. A single bank failure can wipe out the savings of millions. The collapse of Silicon Valley Bank in 2023 — partly due to oversight gaps — reinforced why rigorous bank auditing is non-negotiable.