Browsing by Subject "talletussuoja"

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  • Fantini, Marco (2003)
    BOFIT Online 2003/1
    On 18 November 2002, the Russian cabinet approved a plan to introduce deposit insurance.The introduction of deposit insurance is an essential condition for the modernisation of Russia s banking sector, and, in particular, for ending the near-monopoly of Sberbank, the State Savings Bank, in the retail segment.In this note, we compare the main features of the proposed system with its European and US equivalents.Although several important aspects of the Russian scheme have yet to be defined, our initial evaluation is positive.Concerns about the stability of the Russian banking system, however, remain
  • Fungáčová, Zuzana; Weill, Laurent; Zhou, Mingming (2010)
    BOFIT Discussion Papers 17/2010
    Published in Journal of Financial Services Research, 51(1), 2017: 97-123
    This paper examines how the introduction of deposit insurance influences the relationship between bank cap-ital and liquidity creation. As discussed by Berger and Bouwman (2009), there are two competing hypothes-es on this relationship which can be influenced by the presence of deposit insurance. The introduction of a deposit insurance scheme in an emerging market, Russia, provides a natural experiment to investigate this issue. We study three alternative measures of bank liquidity creation and perform estimations on a large set of Russian banks. Our findings suggest that the introduction of the deposit insurance scheme exerts a limited impact on the relationship between bank capital and liquidity creation and does not change the negative sign of the relationship. The implication is that better capitalized banks tend to create less liquidity, which sup-ports the "financial fragility/crowding-out" hypothesis. This conclusion has important policy implications for emerging countries as it suggests that bank capital requirements implemented to support financial stability may harm liquidity creation. JEL classification: G21; G28; G38; P30; P50 Keywords: Bank capital, liquidity creation, deposit insurance, Russia
  • Niinimäki, Juha-Pekka (2002)
    BOFIT Discussion Papers 2/2002
    Published in Journal of Institutional and Theoretical Economics, vol 159 no 3 (2003), pp. 511-522 as "Maturity transformation without maturity mismatch and bank panics"
    This paper discusses recent bank runs in seven transition economies (Russia, Bulgaria, Estonia, Hungary, Latvia, Lithuania and Romania), comparing them against the older US experience and theoretical research.Bank runs seem to usually be information based.For example, improvements in bank transparency such as new accounting rules can reveal a bank s insolvency and trigger a run. However, bank runs, as seen a few years ago in East Asia, Bulgaria and Russia, may also be accompanied by runs on national currencies. We include a bank run model that shows a bank may issue liquid demand deposits and avoid runs without deposit insurance as long as it also issues less liquid time deposits.Self-fulfilling runs are prevented through elimination of the maturity mismatch.The well-known Diamond & Dybvig (1983) model is modified to account for depositors risk af-finities, whereby high-risk depositors hold their savings as demand deposits and low-risk depositors prefer time deposits.These deposit choices transfer liquidity optimally from low-risk to high-risk depositors who value liquidity.By exploiting these choices, a bank can improve its intertemporal risk-sharing by issuing deposits of varying degrees of liquid-ity. This maturity transformation does not necessarily raise the economy s total liquidity. Key words: transition economies, bank panics, bank regulation, financial crises
  • Haajanen, Jyrki (2012)
    Bank of Finland. Financial market report 2
    Banking union is one of the most important and urgent current EU projects. The aim of efforts to enhance banking supervision, bank crisis resolution and deposit insurance is to improve the stability of the financial markets and ensure broader involvement of creditors.
  • Niinimäki, Juha-Pekka; Mälkönen, Ville (2009)
    Bank of Finland Research Discussion Papers 16/2009
    Published in Journal of Financial Stability, Volume 8, Issue 2, April 2012: 84-95
    This paper examines blanket guarantee and restructuring decisions in respect of a multinational bank (MNB) using Nash bargaining, when the threat of a panic motivates countries to take decisions quickly. The failure of the bank would cause unevenly distributed externalities between the countries concerned, which influences restructuring incentives. In equilibrium, the bank is either liquidated or one or both of the countries recapitalizes it. The partition of the recapitalisation costs is sensitive to the country-specific benefits and costs from recapitalisation, panics and liquidation. The home regulator benefits from the privilege of being the only entity that can legally liquidate the MNB. Rational expectations regarding the bargaining result affect the incentives to declare a blanket guarantee.
  • Bank of Finland (2018)
    Bank of Finland. Bulletin 1/2018
    The completion of Banking Union is an important objective from the perspective of financial stability. Reaching an agreement on a common deposit insurance scheme is a key component in achieving that objective. The purpose of a deposit insurance scheme is to strengthen confidence in uninterrupted access to bank deposits. The size of the Deposit Insurance Fund must be sufficient to credibly withstand possible problem situations. Banks’ deposit insurance contributions should be calibrated based on risks. This would reign in individual banks’ incentives to benefit from a common deposit insurance scheme to which all banks have contributed. Studies show that a common deposit insurance scheme would be quite resilient.
  • Choi, Sungho; Francis, Bill B.; Hasan, Iftekhar (2010)
    Bank of Finland Research Discussion Papers 4/2010
    The impact of cross-border bank M&As on bank risk remains an open question. Though geographically diversifying bank M&As have the potential to reduce the risk of bank insolvency, they also have the potential to increase that risk due to the increase in risk-taking incentives for bank managers and stockholders following these transactions. This paper empirically investigates whether cross-border bank M&As increase or decrease the risk of acquiring banks as captured by changes in acquirers yield spreads. The paper also investigates how differences in the institutional environments between bidder and target countries affect changes in yield spreads following M&A announcements. The study finds that bondholders, in general, perceive cross-border bank M&As as risk-increasing activities, unlike domestic bank mergers. Specifically, on average, yield spreads increase by 4.13 basis points following the announcement of cross-border M&As. This study also finds that these yield spreads are significantly affected by the differences in investor-protection and deposit-insurance environments between the transacting countries. However, the study does not find that the regulatory and supervisory environment in the home countries of the transacting parties significantly affects the changes in yield spreads. The overall evidence suggests that regulators should judge the relative environment in both the home and the host countries in evaluating the associated risks of an active multinational financial institution and in setting the sufficiency of the banks reserve positions.
  • Hein, Eelis (1996)
    Suomen Pankki. E 6
    This study analyzes the valuation and bank risk incentive effects of deposit insurance using an approach based on options theory. While the value of deposit insurance can obviously be set under existing regulatory measures such as capital adequacy and reserve requirements, the actual and expected behaviour of the regulator is shown to exert an effect on bank risk policy, and thus, on the stability of the banking sector.The following factors are identified as possible causes of increased preference for risk on the part of banks: · an expectation that in the event of insolvency the deposit insurance will cover claim holders not otherwise initially insured; · an expectation on the part of shareholders that they are not threatened with losing their position; and · underpricing of deposit insurance premium in relation to a bank's market-valued capital adequacy. These expectations increase preference for higher risk because they remove both the need for debt holders to require any risk premium for their investment and the threat that shareholders might lose their participation in the bank's future earnings.Thus, banks are not "penalized" for taking on risk.Instead, the costs of higher risk are borne by the deposit insurer, which in Finland's case, is ultimately the government and taxpayers.A related issue is that the efficiency of the bank inspection authority seems to affect the risk-taking behaviour of banks (i.e. if a bank believes that the bank inspection authority is incapable of determining its true financial condition and actual risk exposure, it has incentive to take a riskier position). Using bank stock prices, point estimates of the value of deposit insurance are calculated for listed Finnish banks between 1987-1993.The results indicate that the value of the insurance has varied among banks and over time.Generally, charged deposit premia have been underpriced in comparison to the risk position of the studied banks.Thus, one consequence of the shakeout in Finland's banking sector appears to be that a sizable wealth transfer from the government to bank shareholders has taken place. Keywords: Banking, Deposit Insurance, Risk Incentives, Option Pricing, Regulatory Behaviour
  • Karas, Alexei; Pyle, William; Schoors, Koen (2019)
    BOFIT Discussion Papers 10/2019
    Using evidence from Russia, we explore the effect of the introduction of deposit insurance on bank risk. Drawing on within-bank variation in the ratio of firm deposits to total household and firm deposits, so as to capture the magnitude of the decrease in market discipline after the introduction of deposit insurance, we demonstrate for private, domestic banks that larger declines in market discipline generate larger increases in traditional measures of risk. These results hold in a difference-in-difference setting in which state and foreign-owned banks, whose deposit insurance regime does not change, serve as a control.
  • Eduskunta (2016)
    Eduskunnan pankkivaltuuston kertomus Eduskunnalle
  • Hyytinen, Ari; Takalo, Tuomas (2000)
    Suomen Pankin keskustelualoitteita 10/2000
    Transparency regulation aims at reducing financial fragility by strengthening market discipline.There are however two elementary properties of banking that may render such regulation inefficient at best and detrimental at worst.First, an extensive financial safety net may eliminate the disciplinary effect of transparency regulation.Second, achieving transparency is costly for banks, as it dilutes their charter values, and hence it also reduces their private costs of risk-taking.We consider both the direct costs of complying with disclosure requirements and the indirect transparency costs stemming from imperfect property rights governing information and specify the conditions under which transparency regulation can (and cannot) reduce financial fragility. Key words: information disclosure, market discpline, bank transparency, deposit insurance, financial safety net
  • Haajanen, Jyrki (2008)
    EU-tasolla sovittu talletussuojasäännöstö jättää jäsenvaltioille runsaasti mahdollisuuksia muokata kansallisen talletussuojajärjestelmän yksityiskohtia. Lopputuloksena on ollut varsin hajanainen ja suuriakin maittaisia eroja sisältävä talletussuojajärjestelmä, joka ei kaikilta osin ole kyennyt vastaamaan rahoitusmarkkinoiden nopeaan rakennemuutokseen. Useat talletussuojajärjestelmään tarvittavat muutokset ovat kuitenkin hankalia toteuttaa käytännössä.
  • Suomen Pankki (2018)
    Euro & talous 1/2018
    Pankkiunionin viimeisteleminen on rahoitusmarkkinoiden vakauden näkökulmasta tärkeä tavoite. Yhteisestä talletussuojasta sopiminen on keskeinen osa tavoitteen saavuttamista. Talletussuojalla vahvistetaan luottamus pankkitalletusten jatkuvaan saatavuuteen. Talletussuojarahaston tulee olla riittävän suuri kooltaan, jotta se kestää mahdolliset ongelmatilanteet uskottavasti. Pankeilta kerättävät talletussuojamaksut tulisi mitoittaa riskiperusteisesti. Näin hallittaisiin pankkien kannustimia hyötyä yhteisesti maksetusta talletussuojasta. Yhteinen talletussuoja osoittautuu tarkastellun tutkimuksen valossa varsin kestäväksi.
  • Bank of Finland (2017)
    Bank of Finland Bulletin. Analysis
    There are no immediate threats to the stability of the Finnish financial system. The relocation of Nordea’s corporate headquarters will, however, increase the banking sector’s exposure to structural vulnerabilities. The regulatory and supervisory reforms already implemented and participation in the European Banking Union will serve to mitigate the risks associated with the expansion of the banking sector, but adoption of a common European Deposit Insurance Scheme remains an important measure yet to be implemented within the Banking Union. An income-related cap on loans is needed to rein in the increase in household indebtedness.
  • Peresetsky, Anatoly (2008)
    BOFIT Discussion Papers 14/2008
    Published in Russian in Applied Econometrics (Прикладная эконометрика), No. 3, 2008, pp. 3-14 as "Market Discipline and Deposit Insurance" (Рыночная дисциплина и страхование депозитов).
    The paper presents a study of Russian banks' interest rates on household deposits during the formation period of the deposit insurance system. It is shown that market discipline weakened after deposit insurance was effectively in place. JEL codes: G21, G28, P37 Keywords: deposit insurance, market discipline, deposit interest rates
  • Shy, Oz; Stenbacka, Rune (1998)
    Suomen Pankin keskustelualoitteita 22/1998
    This study demonstrates that the common view, whereby an increase in competition leads banks to increased risk taking, fails to hold in an environment where consumers can choose in which bank to make a deposit based on their knowledge of the riskiness incorporated in the banks' outstanding loan portfolios.We show that, in the absence of deposit insurance, competition between differentiated banks will increase the returns from diversification.We offer a welfare analysis establishing that introduction of competition into the banking industry can only improve social welfare.However, competition cannot always guarantee that diversification will occur to a socially optimal extent.Finally, we show that deposit insurance would eliminate the beneficial effects of banks competing with asset quality as a strategic instrument. Keywords: Risk taking in banking, banks' portfolio diversification, bank competition, deposit insurance
  • Haajanen, Jyrki (2016)
    Bank of Finland. Bulletin 2/2016
    In November 2015, the European Commission proposed that a new European Deposit Insurance Scheme be established. The new scheme was to be launched at the beginning of 2017 and the reform include an 8-year transitional period. During this period the responsibility for pay-outs was to gradually be transferred from national level to the European Deposit Insurance Scheme by 2024.
  • Pyykönen, Sami (2015)
    Finanssivalvonta. Blogi 9.12.2015
    Vuosia on keskusteltu siitä, että sijoittajavastuun toteutuminen pank-kien kohdalla on ollut puutteellista, sillä valtioiden on oletettu pelastavan ongelmiin ajautuneet pankkinsa. Historia on näyttänyt, että pääsääntöisesti juuri näin on käynytkin. Tätä on kutsuttu myös ”too big to fail” -ongelmaksi. Sijoittajavastuun toteutumisella tarkoitetaan, että pankin osakkeenomistajat ja velkojat kantavat pankin tappiot veronmaksajien sijaan.
  • Haajanen, Jyrki (2012)
    Suomen Pankki. Rahoitusmarkkinaraportti 2
    Pankkiunioni on yksi merkittävimmistä ja kiireellisimmistä EU-hankkeista. Pankki-valvonnan, pankkien kriisinratkaisujärjestelmän sekä talletussuojan kehittämisen tavoitteena on parantaa rahoitusmarkkinoiden vakautta sekä mahdollistaa nykyistä laajempi sijoittajanvastuun toteutuminen.
  • Disli, Mustafa; Schoors, Koen; Meir, Jos (2013)
    BOFIT Discussion Papers 6/2013
    Published in Journal of Financial Stability, Vol. 9, No. 4, 2013, Pages 804–819
    We examine the effects of political connections on depositor discipline in a sample of Turkish banks. Banks with former members of parliament at the helm enjoy reduced depositor discipline, especially if the former politician's party is currently in power - less so if the former politician served as a minister. Banks with structural problems are more likely to appoint former politicians, but our results remain robust after controlling for selection effects. Ministers may reduce depositor discipline less because they signal severe problems and because the additional government deposits they bring to the bank during their term tend to leave with them. Keywords: Depositor discipline, political connections, banks JEL: G1, G2, D7