Deposit Insurance and Crisis Management
Author: G. G. Garcia
Publisher: International Monetary Fund
Published: 2000-03
Total Pages: 86
ISBN-13:
DOWNLOAD EBOOKA 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 paper also examines factors in the decision to grant, temporarily, a comprehensive guarantee, and the design of that guarantee, should a systemic financial crisis nevertheless occur. It concludes with guidance on the removal of that guarantee.