Deposit Insurance and Bank Supervision

4 European Banking Union

10.1093/law/9780198743057.003.0004 ◽

2015 ◽

Author(s):

Kleftouri Nikoletta

Keyword(s):

Euro Area ◽

Deposit Insurance ◽

Spillover Effects ◽

Banking Union ◽

Bank Supervision ◽

European Banking Union ◽

Cross Border ◽

European Bank ◽

Bank Resolution ◽

European Banking

Having a multiplicity of financial regulators, supervisors, and resolution authorities in Europe can weaken supervision, heighten legal uncertainty, and impede effective resolution. European officials recently agreed that further steps are needed to tackle the specific risks in particular within the euro area, where pooled monetary responsibilities had increased the possibility of cross-border spillover effects in the event of bank crises. As a result, they created a union aimed to centralize bank supervision, deposit insurance, and bank resolution. This chapter sets out two components of the European banking union: single supervision, and single deposit insurance. Single resolution is separately discussed in Chapter 8, where international and European bank resolution frameworks are examined. The chapter concludes that deeper reforms are needed, in conjunction with effective cooperation arrangements.

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Intermediation Spread, Bank Supervision, and Financial Stability

Review of Pacific Basin Financial Markets and Policies ◽

10.1142/s0219091510002050 ◽

2010 ◽

Vol 13 (04) ◽

pp. 517-537 ◽

Cited By ~ 4

Author(s):

Süheyla Özyıldırım

Keyword(s):

High Risk ◽

Risk Taking ◽

Financial Stability ◽

Deposit Insurance ◽

Developing Economies ◽

Financial Intermediaries ◽

Bank Efficiency ◽

Bank Supervision ◽

Insurance Premiums ◽

Lower Limits

This paper models the effect of bank competition and deposit insurance premiums on the spread between lending and deposit rates. In developing economies, low spreads do not always indicate bank efficiency; they may be the result of high risk taking. This paper shows that imposing upper and lower limits on banks' spreads and adjusting deposit insurance premiums when violation of these limits occurs leads to a more stable but relatively large intermediation costs. In developing economies, such an outcome would be considered more desirable because it insulates existing financial intermediaries and investors against macroeconomic disturbances.

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