Financial Inclusion for Stability: Access to Bank Deposits and the Deposit Growth during the Global Financial Crisis

Rui Han () and Martin Melecký

MPRA Paper from University Library of Munich, Germany

Abstract: In crisis times, depositors get anxious, can run on banks, and withdraw their deposits. Correlated deposit withdrawals of bank deposits could be mitigated if bank deposits are more diversified, i.e. held by more individuals. This paper examines the link between a broader access to bank deposits prior to the 2008 crisis and the dynamics of bank deposit growth in the crisis, while controlling for relevant covariates. Employing the proxies of Honohan (2008) for access to deposits and of Demirguc-Kunt and Klapper (2012) for the use of bank deposits, the authors find that greater access to bank deposits can make the deposit funding base of banks more resilient in times of financial stress. Policy efforts to enhance financial stability should thus focus not only on macroprudential regulation, but also recognize the positive effect of broader access to bank deposits on financial stability.

Keywords: Financial Inclusion; Access to Deposits; Deposit Withdrawals; Financial Stability; 2008 Global Financial Crisis. (search for similar items in EconPapers)
JEL-codes: G01 G21 G28 (search for similar items in EconPapers)
Date: 2013-03
New Economics Papers: this item is included in nep-ban
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (34)

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https://mpra.ub.uni-muenchen.de/45787/1/MPRA_paper_45787.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/48337/1/MPRA_paper_45787.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/48338/8/MPRA_paper_48338.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/48339/8/MPRA_paper_48338.pdf revised version (application/pdf)

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