Cross-Border Coordination of Prudential Supervision and Deposit Guarantees
December 1, 2008
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Summary
The scramble to expand deposit guarantees in Europe in response to recent financial turmoil confirms that the on-going integration of European financial markets requires closer coordination of prudential policies and financial safety nets. We study the optimal design of prudential supervision and deposit guarantee regulations in a multi-country, integrated banking market such as the European Union, where policy-makers have either similar or asymmetric preferences regarding profitability and stability of the banking sector. The paper concludes with recommendations on policy priorities in this area.
Subject: Banking, Banking crises, Deposit insurance, Distressed institutions, Financial sector stability
Keywords: deposit guarantee, WP
Pages:
26
Volume:
2008
DOI:
Issue:
283
Series:
Working Paper No. 2008/283
Stock No:
WPIEA2008283
ISBN:
9781451871418
ISSN:
1018-5941
