Bank Examination Definition

A periodic review of: a bank’s assets and liabilities, as listed on its balance sheet; the competence of bank management; the quality of bank assets, especially loans; and the bank’s compliance with state or federal banking regulations. Bank examinations are conducted by the bank’s supervisory agency in order to detect problems at a bank before they become so serious as to result in the closure of the bank and investors’ loss of funds.
Webster's New World Finance