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Depositor and Investor Protection in the EU and the Netherlands: A Brief History

Author

Listed:
  • Gillian Garcia
  • Henriette Prast

Abstract

This paper provides some history of deposit insurance and investor protection in the Netherlands against the background of the history of such protection in the European Union, EU-legislation and the recent changes in the design of financial supervision in the Netherlands. It discusses how countries have responded to the EU-directives and to the changes in the financial environment. The main findings of the paper are the following. The Netherlands was among the first European countries to introduce deposit insurance. Deposit insurance systems in the EU are frequently funded ex post and offer lower coverage than systems in most other regions of the world. The system in the Netherlands shares these characteristics. Over time, all countries have adapted their systems in the spirit of the EU-directives on the matter, although it seems that some countries still need to undertake changes to comply with specific articles. During the 1990s, some convergence towards best practices has taken place. EU-regulation has obliged member countries to make their systems mandatory and there is a tendency towards ex ante funding and risk-related premiums. The the issues to be addressed by the Netherlands are whether to combine deposit and investor protection schemes, shift to ex ante funding partially or entirely and impose risk-adjusted charges. A follow-up paper will examine these issues further.

Suggested Citation

  • Gillian Garcia & Henriette Prast, 2003. "Depositor and Investor Protection in the EU and the Netherlands: A Brief History," Research Series Supervision (discontinued) 54, Netherlands Central Bank, Directorate Supervision.
  • Handle: RePEc:dnb:ressup:54
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    File URL: https://www.dnb.nl/en/binaries/ot054_tcm47-146064.pdf
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    References listed on IDEAS

    as
    1. Joke Mooij & Henriette Prast, 2003. "A brief history of the institutional design of banking supervision in the Netherlands," Chapters,in: Banking Supervision at the Crossroads, chapter 2 Edward Elgar Publishing.
    2. Franklin Allen & Douglas Gale, 1998. "Optimal Financial Crises," Journal of Finance, American Finance Association, vol. 53(4), pages 1245-1284, August.
    3. G. G. Garcia, 2000. "Deposit Insurance; Actual and Good Practices," IMF Occasional Papers 197, International Monetary Fund.
    4. Gropp, Reint & Vesala, Jukka, 2001. "Deposit insurance and moral hazard: does the counterfactual matter?," Working Paper Series 0047, European Central Bank.
    5. Asli Demirgüç-Kunt & Enrica Detragiache, 1998. "The Determinants of Banking Crises in Developing and Developed Countries," IMF Staff Papers, Palgrave Macmillan, vol. 45(1), pages 81-109, March.
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    Cited by:

    1. Donato Masciandaro & María J. Nieto & Henriëtte Prast, 2007. "Financial governance of banking supervision," Working Papers 0725, Banco de España;Working Papers Homepage.
    2. Henriëtte Prast & Iman van Lelyveld, 2004. "New Architectures in the Regulation and Supervision of Financial Markets and Institutions: The Netherlands," DNB Working Papers 021, Netherlands Central Bank, Research Department.
    3. Konstantijn Maes, 2004. "Interest Rate Risk in the Belgian Banking Sector," Financial Stability Review, National Bank of Belgium, vol. 2(1), pages 157-179, June.

    More about this item

    Keywords

    Deposit insurance; investor protection; EU-directives;

    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • N24 - Economic History - - Financial Markets and Institutions - - - Europe: 1913-

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