Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence

There is a wide cross-country variation in the institutional structure of bank failure resolution, including the role of the deposit insurer. The authors use quantitative analysis for 57 countries and discuss specific country cases to illustrate this variation. Using data for over 1,700 banks across...

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Main Authors:	Beck, Thorsten, Laeven, Luc
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ACCOUNTABILITY ACCOUNTING BANK EARNINGS BANK FAILURE BANK FAILURE RESOLUTION BANK FAILURES BANK FOR INTERNATIONAL SETTLEMENTS BANK HOLDING COMPANY BANK INSOLVENCY BANK MONITORING BANK REGULATION BANK RISK BANK RUNS BANK SUPERVISION BANKING CRISES BANKING CRISIS BANKING INDUSTRY BANKING SUPERVISION BANKING SYSTEM BANKING SYSTEMS BANKRUPTCY BANKS CAPITAL ADEQUACY CAPITAL BASE CAR CENTRAL BANK CLOSED BANKS COMMISSIONS COMPETITIVENESS CONFLICT OF INTEREST CORPORATE INSOLVENCY CORPORATE SECTOR CORPORATIONS CURRENCY CRISES DEBT DEPOSIT INSURANCE DEPOSIT INSURANCE COVERAGE DEPOSIT INSURANCE SCHEMES DEPOSIT PROTECTION DEPOSITORS DEPOSITS DEREGULATION ECONOMIC GROWTH ECONOMICS EXPLICIT COVERAGE FEDERAL DEPOSIT INSURANCE FEDERAL DEPOSIT INSURANCE CORPORATION FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL DISTRESS FINANCIAL INSTITUTIONS FINANCIAL INTERMEDIATION FINANCIAL RATIOS FINANCIAL RESTRUCTURING FINANCIAL STATEMENTS FINANCIAL SYSTEMS HOUSING IMPAIRED ASSETS INFORMATION DISCLOSURE INSOLVENCY INSOLVENCY REGIME INSOLVENCY REGIMES INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURED DEPOSITS INSURERS INTEREST INCOME INTERVENTION POWERS INVESTIGATION LEGAL FRAMEWORK LIMITED LIMITED DEPOSIT INSURANCE LIQUID ASSETS LIQUIDATION LIQUIDITY LIQUIDITY OF BANKS LOAN CLASSIFICATION MARKET DISCIPLINE MEASURES OF PROFITABILITY MERGERS MORAL HAZARD OPERATING INCOME PENALTIES PRIVATE COMMERCIAL BANKS PROBABILITY OF DEFAULT PROBLEM BANKS PROXY PUT OPTION RATES REGULATORY AUTHORITY REGULATORY FORBEARANCE RELATIONSHIP LENDING RESOLVING BANKING CRISES RETURN ON ASSETS RISK MANAGEMENT RISK TAKING SAVINGS SMALL BANKS SOCIETY STOCK MARKET STOCK MARKETS SUPERVISORY AGENCIES SUPERVISORY FRAMEWORK SYSTEMIC BANKING CRISES TRADING TRANSMISSION OF MONETARY POLICY TRINIDAD AND TOBAGO UNION VOLATILITY
Online Access:	http://documents.worldbank.org/curated/en/2006/05/6783605/resolution-failed-banks-deposit-insurers-cross-country-evidence http://hdl.handle.net/10986/8661

id	okr-10986-8661
recordtype	oai_dc
spelling	okr-10986-86612021-04-23T14:02:40Z Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence Beck, Thorsten Laeven, Luc ACCOUNTABILITY ACCOUNTING BANK EARNINGS BANK FAILURE BANK FAILURE RESOLUTION BANK FAILURES BANK FOR INTERNATIONAL SETTLEMENTS BANK HOLDING COMPANY BANK INSOLVENCY BANK MONITORING BANK REGULATION BANK RISK BANK RUNS BANK SUPERVISION BANKING CRISES BANKING CRISIS BANKING INDUSTRY BANKING SUPERVISION BANKING SYSTEM BANKING SYSTEMS BANKRUPTCY BANKS CAPITAL ADEQUACY CAPITAL BASE CAR CENTRAL BANK CLOSED BANKS COMMISSIONS COMPETITIVENESS CONFLICT OF INTEREST CORPORATE INSOLVENCY CORPORATE SECTOR CORPORATIONS CURRENCY CRISES DEBT DEPOSIT INSURANCE DEPOSIT INSURANCE COVERAGE DEPOSIT INSURANCE SCHEMES DEPOSIT PROTECTION DEPOSITORS DEPOSITS DEREGULATION ECONOMIC GROWTH ECONOMICS EXPLICIT COVERAGE FEDERAL DEPOSIT INSURANCE FEDERAL DEPOSIT INSURANCE CORPORATION FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL DISTRESS FINANCIAL INSTITUTIONS FINANCIAL INTERMEDIATION FINANCIAL RATIOS FINANCIAL RESTRUCTURING FINANCIAL STATEMENTS FINANCIAL SYSTEMS HOUSING IMPAIRED ASSETS INFORMATION DISCLOSURE INSOLVENCY INSOLVENCY REGIME INSOLVENCY REGIMES INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURED DEPOSITS INSURERS INTEREST INCOME INTERVENTION POWERS INVESTIGATION LEGAL FRAMEWORK LIMITED LIMITED DEPOSIT INSURANCE LIQUID ASSETS LIQUIDATION LIQUIDITY LIQUIDITY OF BANKS LOAN CLASSIFICATION MARKET DISCIPLINE MEASURES OF PROFITABILITY MERGERS MORAL HAZARD OPERATING INCOME PENALTIES PRIVATE COMMERCIAL BANKS PROBABILITY OF DEFAULT PROBLEM BANKS PROXY PUT OPTION RATES REGULATORY AUTHORITY REGULATORY FORBEARANCE RELATIONSHIP LENDING RESOLVING BANKING CRISES RETURN ON ASSETS RISK MANAGEMENT RISK TAKING SAVINGS SMALL BANKS SOCIETY STOCK MARKET STOCK MARKETS SUPERVISORY AGENCIES SUPERVISORY FRAMEWORK SYSTEMIC BANKING CRISES TRADING TRANSMISSION OF MONETARY POLICY TRINIDAD AND TOBAGO UNION VOLATILITY There is a wide cross-country variation in the institutional structure of bank failure resolution, including the role of the deposit insurer. The authors use quantitative analysis for 57 countries and discuss specific country cases to illustrate this variation. Using data for over 1,700 banks across 57 countries, they show that banks in countries where the deposit insurer has the responsibility of intervening failed banks and the power to revoke membership in the deposit insurance scheme are more stable and less likely to become insolvent. Involvement of the deposit insurer in bank failure resolution thus dampens the negative effect that deposit insurance has on banks' risk taking. 2012-06-21T17:14:36Z 2012-06-21T17:14:36Z 2006-05 http://documents.worldbank.org/curated/en/2006/05/6783605/resolution-failed-banks-deposit-insurers-cross-country-evidence http://hdl.handle.net/10986/8661 English Policy Research Working Paper; No. 3920 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCOUNTABILITY ACCOUNTING BANK EARNINGS BANK FAILURE BANK FAILURE RESOLUTION BANK FAILURES BANK FOR INTERNATIONAL SETTLEMENTS BANK HOLDING COMPANY BANK INSOLVENCY BANK MONITORING BANK REGULATION BANK RISK BANK RUNS BANK SUPERVISION BANKING CRISES BANKING CRISIS BANKING INDUSTRY BANKING SUPERVISION BANKING SYSTEM BANKING SYSTEMS BANKRUPTCY BANKS CAPITAL ADEQUACY CAPITAL BASE CAR CENTRAL BANK CLOSED BANKS COMMISSIONS COMPETITIVENESS CONFLICT OF INTEREST CORPORATE INSOLVENCY CORPORATE SECTOR CORPORATIONS CURRENCY CRISES DEBT DEPOSIT INSURANCE DEPOSIT INSURANCE COVERAGE DEPOSIT INSURANCE SCHEMES DEPOSIT PROTECTION DEPOSITORS DEPOSITS DEREGULATION ECONOMIC GROWTH ECONOMICS EXPLICIT COVERAGE FEDERAL DEPOSIT INSURANCE FEDERAL DEPOSIT INSURANCE CORPORATION FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL DISTRESS FINANCIAL INSTITUTIONS FINANCIAL INTERMEDIATION FINANCIAL RATIOS FINANCIAL RESTRUCTURING FINANCIAL STATEMENTS FINANCIAL SYSTEMS HOUSING IMPAIRED ASSETS INFORMATION DISCLOSURE INSOLVENCY INSOLVENCY REGIME INSOLVENCY REGIMES INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURED DEPOSITS INSURERS INTEREST INCOME INTERVENTION POWERS INVESTIGATION LEGAL FRAMEWORK LIMITED LIMITED DEPOSIT INSURANCE LIQUID ASSETS LIQUIDATION LIQUIDITY LIQUIDITY OF BANKS LOAN CLASSIFICATION MARKET DISCIPLINE MEASURES OF PROFITABILITY MERGERS MORAL HAZARD OPERATING INCOME PENALTIES PRIVATE COMMERCIAL BANKS PROBABILITY OF DEFAULT PROBLEM BANKS PROXY PUT OPTION RATES REGULATORY AUTHORITY REGULATORY FORBEARANCE RELATIONSHIP LENDING RESOLVING BANKING CRISES RETURN ON ASSETS RISK MANAGEMENT RISK TAKING SAVINGS SMALL BANKS SOCIETY STOCK MARKET STOCK MARKETS SUPERVISORY AGENCIES SUPERVISORY FRAMEWORK SYSTEMIC BANKING CRISES TRADING TRANSMISSION OF MONETARY POLICY TRINIDAD AND TOBAGO UNION VOLATILITY
spellingShingle	ACCOUNTABILITY ACCOUNTING BANK EARNINGS BANK FAILURE BANK FAILURE RESOLUTION BANK FAILURES BANK FOR INTERNATIONAL SETTLEMENTS BANK HOLDING COMPANY BANK INSOLVENCY BANK MONITORING BANK REGULATION BANK RISK BANK RUNS BANK SUPERVISION BANKING CRISES BANKING CRISIS BANKING INDUSTRY BANKING SUPERVISION BANKING SYSTEM BANKING SYSTEMS BANKRUPTCY BANKS CAPITAL ADEQUACY CAPITAL BASE CAR CENTRAL BANK CLOSED BANKS COMMISSIONS COMPETITIVENESS CONFLICT OF INTEREST CORPORATE INSOLVENCY CORPORATE SECTOR CORPORATIONS CURRENCY CRISES DEBT DEPOSIT INSURANCE DEPOSIT INSURANCE COVERAGE DEPOSIT INSURANCE SCHEMES DEPOSIT PROTECTION DEPOSITORS DEPOSITS DEREGULATION ECONOMIC GROWTH ECONOMICS EXPLICIT COVERAGE FEDERAL DEPOSIT INSURANCE FEDERAL DEPOSIT INSURANCE CORPORATION FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL DISTRESS FINANCIAL INSTITUTIONS FINANCIAL INTERMEDIATION FINANCIAL RATIOS FINANCIAL RESTRUCTURING FINANCIAL STATEMENTS FINANCIAL SYSTEMS HOUSING IMPAIRED ASSETS INFORMATION DISCLOSURE INSOLVENCY INSOLVENCY REGIME INSOLVENCY REGIMES INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURED DEPOSITS INSURERS INTEREST INCOME INTERVENTION POWERS INVESTIGATION LEGAL FRAMEWORK LIMITED LIMITED DEPOSIT INSURANCE LIQUID ASSETS LIQUIDATION LIQUIDITY LIQUIDITY OF BANKS LOAN CLASSIFICATION MARKET DISCIPLINE MEASURES OF PROFITABILITY MERGERS MORAL HAZARD OPERATING INCOME PENALTIES PRIVATE COMMERCIAL BANKS PROBABILITY OF DEFAULT PROBLEM BANKS PROXY PUT OPTION RATES REGULATORY AUTHORITY REGULATORY FORBEARANCE RELATIONSHIP LENDING RESOLVING BANKING CRISES RETURN ON ASSETS RISK MANAGEMENT RISK TAKING SAVINGS SMALL BANKS SOCIETY STOCK MARKET STOCK MARKETS SUPERVISORY AGENCIES SUPERVISORY FRAMEWORK SYSTEMIC BANKING CRISES TRADING TRANSMISSION OF MONETARY POLICY TRINIDAD AND TOBAGO UNION VOLATILITY Beck, Thorsten Laeven, Luc Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence
relation	Policy Research Working Paper; No. 3920
description	There is a wide cross-country variation in the institutional structure of bank failure resolution, including the role of the deposit insurer. The authors use quantitative analysis for 57 countries and discuss specific country cases to illustrate this variation. Using data for over 1,700 banks across 57 countries, they show that banks in countries where the deposit insurer has the responsibility of intervening failed banks and the power to revoke membership in the deposit insurance scheme are more stable and less likely to become insolvent. Involvement of the deposit insurer in bank failure resolution thus dampens the negative effect that deposit insurance has on banks' risk taking.
format	Publications & Research :: Policy Research Working Paper
author	Beck, Thorsten Laeven, Luc
author_facet	Beck, Thorsten Laeven, Luc
author_sort	Beck, Thorsten
title	Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence
title_short	Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence
title_full	Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence
title_fullStr	Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence
title_full_unstemmed	Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence
title_sort	resolution of failed banks by deposit insurers : cross-country evidence
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2006/05/6783605/resolution-failed-banks-deposit-insurers-cross-country-evidence http://hdl.handle.net/10986/8661
_version_	1764406068524351488

Resolution of Failed Banks by Deposit Insurers : Cross-Country Evidence

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