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An approach to bank insolvency in transition and emerging economies

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  • David G. Mayes

    (Bank of Finland)

Abstract

In the light of the inequity of the way losses from bank insolvencies and their avoidance through intervention by the authorities have been distributed over creditors, depositors, owners and the population at large in transition and emerging economies, this paper explores a number of regulatory reforms that would alter the balance between seeking to avoid insolvency and lowering the costs of insolvency should it occur. In particular it considers whether a lex specialis for dealing with banks that are in trouble through prompt corrective action and if necessary resolving them if their net worth falls to zero, at little or no cost to the taxpayer can be applied in the institutional framework of transition and emerging economies.

Suggested Citation

  • David G. Mayes, 2004. "An approach to bank insolvency in transition and emerging economies," Finance 0404015, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpfi:0404015
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    3. Leitemo, Kai & Sã–Derstrã–M, Ulf, 2008. "Robust Monetary Policy In The New Keynesian Framework," Macroeconomic Dynamics, Cambridge University Press, vol. 12(S1), pages 126-135, April.

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    More about this item

    Keywords

    insolvency; banks; transition; emerging economies;
    All these keywords.

    JEL classification:

    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • E53 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Deposit Insurance

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