A Study of Mutual Insurance for Bank Deposits

Carole Bernard, Olivier Courtois () and François Quittard-Pinon

The Geneva Papers on Risk and Insurance Theory, 2005, vol. 30, issue 2, 129-146

Abstract: This article displays a study on the mutual insurance of bank deposits. A system where deposits are first insured by a consortium then by the Government is envisaged. We wish to compute the fair premia due to both the consortium and the Government. Various types of covenants aiming at making banks reduce their risks are detailed. These provisions can be, as is the case in Chapter 11, of a Parisian type. This means that surveillance is based on the path followed by the assets or the leverage. We compare these various types of covenants and conclude on the proposal for new regulatory provisions. Copyright Springer Science + Business Media, Inc. 2005

Keywords: parisian options; deposit insurance; surveillance mechanisms; contingent claims analysis (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s10713-005-4675-2

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