The Banker's algorithm is a fundamental concept in operating systems, particularly in the context of resource allocation and deadlock avoidance. It's a mathematical model used to determine whether a sequence of processes' resource requests can be safely granted, without leading to a deadlock in the system.
To simplify, it helps the operating system make informed decisions about granting resources to processes in a way that avoids situations where processes are waiting indefinitely for resources.
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• The banker's algorithm is a resource allocation and deadlock avoidance technique that simulates allocation for preset maximum possible amounts of all resources, then performs a 's-state' check to check for probable actions before deciding whether allocation should be permitted to continue.
• The banker's algorithm is named for the fact that it is employed in the banking system to determine whether or not a loan can be granted to a specific individual. Assume there are n account holders at a bank, and the total amount of money in their accounts is S.
• If a person applies for a loan, the bank subtracts the loan amount from the total amount of money it has, and only the loan is sanctioned if the leftover sum is more than S. It is done because the bank can easily do it if all of the account holders come to withdraw their money.

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