Gersbach, Hans - In: CESifo economic studies : CESifo, a joint initiative of … 59 (2013) 4, pp. 609-627
In this article, we review the functioning of private insurance against banking crises and identify its potential. The essential idea is that banks are recapitalized by private investors when negative events would otherwise cause a write-down of capital—or even bank insolvency. There are two...
