IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/03-17.html
   My bibliography  Save this paper

What Happens After Supervisory Intervention? Considering Bank Closure Options

Author

Listed:
  • Mats A Josefsson
  • Michael Andrews

Abstract

Closures have been used to resolve problem banks in many countries in a wide range of economic circumstances, yet banking supervisors frequently defer intervention and closure. Avoiding the costs of disruption is the principal argument in favor of extraordinary measures, such as the use of public funds for recapitalization or forbearance, as alternatives to closing insolvent banks. Well-planned and implemented closure options can preserve essential functions performed by failing banks, mitigating disruption. Extraordinary measures to avoid closure should generally be avoided, but may be used in a systemic crisis to preserve some portion of a widely insolvent banking sector.

Suggested Citation

  • Mats A Josefsson & Michael Andrews, 2003. "What Happens After Supervisory Intervention? Considering Bank Closure Options," IMF Working Papers 03/17, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:03/17
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=16222
    Download Restriction: no

    References listed on IDEAS

    as
    1. Gerard Caprio & Patrick Honohan, 2008. "Banking Crises," Center for Development Economics 2008-09, Department of Economics, Williams College.
    2. Edward J Frydl, 1999. "The Length and Cost of Banking Crises," IMF Working Papers 99/30, International Monetary Fund.
    3. Paul Hoffman & Anthony M. Santomero, 1998. "Problem Bank Resolution: Evaluating the Options," Center for Financial Institutions Working Papers 98-05, Wharton School Center for Financial Institutions, University of Pennsylvania.
    4. Dong He, 2000. "Emergency Liquidity Support Facilities," IMF Working Papers 00/79, International Monetary Fund.
    5. Tamim Bayoumi & Paul R Masson, 1998. "Market-Based Policy Instruments for Systemic Bank Restructuring," IMF Working Papers 98/113, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Harrison, Ian & Anderson, Steve & Twaddle, James, 2007. "Pre-positioning for effective resolution of bank failures," Journal of Financial Stability, Elsevier, vol. 3(4), pages 324-341, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:03/17. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jim Beardow) or (Hassan Zaidi). General contact details of provider: http://edirc.repec.org/data/imfffus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.