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This paper argues that in the European Union (EU) deposit insurance funds are too difficult to use in bank resolution and too easy to use outside resolution. The paper proposes reforms in three areas for the effective management of bank failures of small and medium-sized banks in the European...
Persistent link: https://www.econbiz.de/10013170606
This paper provides a comprehensive, global database of deposit insurance arrangements as of 2013. We extend our earlier dataset by including recent adopters of deposit insurance and information on the use of government guarantees on banks’ assets and liabilities, including during the recent...
Persistent link: https://www.econbiz.de/10012667446
This paper studies banks' decision to form financial interconnections using a model of financial contagion that explicitly takes into account the crisis state of the world. This allows us to model the network formation decision as optimising behaviour of competitive banks, where they balance the...
Persistent link: https://www.econbiz.de/10011715336
A well-designed deposit insurance system (DIS) will provide incentives for citizens to keep the financial system sound. However, a poorly designed DIS can foster a financial crisis. This paper, therefore, makes recommendations for creating and running a limited, incentive-compatible, DIS. The...
Persistent link: https://www.econbiz.de/10014399875
European finance is becoming increasingly cross-border, while the European architecture for safeguarding financial stability - including decision-making processes for providing financial-stability public goods - have remained decentralized with some explicit mechanisms for coordination across...
Persistent link: https://www.econbiz.de/10014400566
The scramble to expand deposit guarantees in Europe in response to recent financial turmoil confirms that the on-going integration of European financial markets requires closer coordination of prudential policies and financial safety nets. We study the optimal design of prudential supervision...
Persistent link: https://www.econbiz.de/10014401736
Persistent link: https://www.econbiz.de/10010388660
Germany, Greece, Ireland, Italy, Spain and Portugal. The stability of Germany is a close proxy for the resilience of the euro … during 2009–12 were due to idiosyncratic factors, market developments in Italy and Spain contributed significantly, likely …’s sovereign CDS despite initial widespread concerns about such linkages. Spain and Italy show a notable co-dependence in …
Persistent link: https://www.econbiz.de/10014411217
Persistent link: https://www.econbiz.de/10009424798
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