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Report
The procyclical application of bank capital requirements
Capital requirements have long been considered important to bank safety and the protection of the federal deposit insurance fund. But widespread banking problems and heavy losses to the deposit insurance fund have intensified the focus on capital. Supervisory agencies have become even more rigorous in applying and enforcing capital standards, imposing higher requirements on damaged banks. Furthermore, capital requirements have taken on greater significance as a result of a key provision of the recently enacted banking legislation, the Federal Deposit Insurance Corporation Improvement Act of ...
Conference Paper
Safeguarding the banking system from financial cycles
Conference Paper
Insurance companies as financial intermediaries: risk and return
Conference Paper
General discussion
Journal Article
The need to protect depositors of large banks, and the implications for powers and ownership
Three fundamental and interconnected issues should be carefully considered before making any decisions on altering the federal safety net or the structure of the U.S. banking system. The first is whether or not bank depositors and other creditors can exercise timely and meaningful restraint on excessive risk-taking by bank managements. The second is whether the government should handle the orderly resolution of large bank failures in such a way that uninsured depositors and other bank creditors are protected. The third fundamental issue is the degree to which banking should continue to be ...
Journal Article
Lessons from New England bank failures
The failure of the Rhode Island Share and Deposit Indemnity Corporation (RISDIC), a private insurance fund, and the closure of its 45 remaining member institutions froze the accounts of 300,000 individuals and 10 percent of all deposits in the state. While the closure of two institutions triggered RISDICs demise, flaws in both design and management had set the stage for failure and are the focus of this article. The authors group RISDICs problems into three categories: risk concentrations, control of the insurance fund by those it insured, and RISDICs inadequate regulatory oversight of ...