Pretty sure it was illegal in the back in the day when each nations had public-owned banks, like here in Australia with the Commonwealth Bank. Infrastructure and nation building was it's basic remit, it was run at-cost and every citizen had a right to a private account. Pretty sure that's the basic idea but it was broken up and greedily sold off into privatisation a bit before my time.
It was a government-run enterprise. Who knows if a government could be trusted to set up a proper private citizen's bank in this day and age? Would need sufficient oversight and transparent dealings (blockchain). Not sure but I think New Zealand have done a decent job with their postal banks not too long ago.
I guess really it's up to 'us' — the owners, users and defenders of open source, decentralised software and hardware infrastructure! Looking forward to the day I can buy and sell products and necessities with HBD...