Final answer:
An independent bank is one that is not controlled by a multi-bank holding company or external interests, functioning autonomously and often serving local markets as a financial intermediary.
Step-by-step explanation:
An "independent" bank is defined as (e) not controlled by a multi-bank holding company or any other outside interest. This means it operates autonomously and is not under the control or influence of larger banking conglomerates known as bank holding companies. The Federal Reserve supervises these bank holding companies, while other regulators, like the Office of the Comptroller of the Currency, supervise the individual banks within them.
An independent bank is not part of such a structure and thus has its own governance and policies, often serving local or niche markets. When a bank is independent, it functions as a financial intermediary on its own, managing deposits and making loans directly to individuals and businesses without the influence of a larger corporate structure.