proem

Economics, Econometrics and Finance

4 years ago

Bank failures pose greater economic threat than other firm collapses.

Post-Resolution Treatment of Depositors at Failed Banks: Implications for the Severity of Banking Crises, Systemic Risk, and Too-Big-To-Fail

George G. Kaufman, Steven Seelig

Paper Summary

Economics, Econometrics and Finance

4 years ago

Bank failures pose greater economic threat than other firm collapses.

Palgrave Macmillan UK eBooks

Post-Resolution Treatment of Depositors at Failed Banks: Implications for the Severity of Banking Crises, Systemic Risk, and Too-Big-To-Fail

George G. Kaufman, Steven Seelig

Paper Summary

Bank failures are more damaging than other firm failures due to potential losses to depositors, disruptions to the payments system, and systemic risks. Government safety nets like deposit insurance and "too-big-to-fail" guarantees aim to protect stakeholders from losses.