Issues in the Reform of Deposit Insurance and Regulation of Depository Institutions

International Monetary Fund

No 1990/074, IMF Working Papers from International Monetary Fund

Abstract: In the United States, the thrift industry crisis and evidence of financial weakness in the banking industry have raised concerns about the cost-effectiveness of the present framework of deposit insurance and regulation of depository institutions that serves to control systemic risks. The reform proposals discussed in this paper aim to create a more cost-effective approach by either modifying the operation of the deposit insurance funds to reduce the value of the deposit guarantee or altering those regulations of depository institutions that limit portfolio risk to reduce their overall cost. Consideration is given to both the potential effectiveness and practicability of the proposed reforms.

Keywords: WP; insurance fund; Glass-Steagall Act; deposit guarantee; financial product; deposit insurance; bank profitability; Deposit insurance; Commercial banks; Securities; Capital adequacy requirements (search for similar items in EconPapers)
Pages: 28
Date: 1990-01-01
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