Artikel
European bank deposit insurance could cushion impact of corona-induced corporate insolvencies
The European banking union has so far lacked its third pillar: a joint insurance fund for bank savings deposits. As the present study shows, this could be a major disadvantage in dealing with the economic impact of the corona pandemic. A scenario in which a wave of corporate insolvencies leads to loan and deposit losses reaching six percent over a year would over- whelm Germany's national deposit insurance scheme. Even if the government were to step in and guarantee all deposits, a European deposit insurance scheme (EDIS) would be by far the better option. With EDIS in place, private consumption would fall by 20 percent less and lending by around ten percent less than if the government were to initiate a bailout, which would also significantly increase public debt. From a German perspective, a swift introduction of EDIS would greatly increase risk-sharing. However, it is important to develop an efficient EDIS funding mechanism in order to minimize the burden on banks. Precautions should also be taken to prevent banks from taking greater risks as a result of EDIS being implemented.
- Sprache
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Englisch
- Erschienen in
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Journal: DIW Weekly Report ; ISSN: 2568-7697 ; Volume: 10 ; Year: 2020 ; Issue: 32/33 ; Pages: 325-333 ; Berlin: Deutsches Institut für Wirtschaftsforschung (DIW)
- Klassifikation
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Wirtschaft
Policy Objectives; Policy Designs and Consistency; Policy Coordination
International Policy Coordination and Transmission
Macroeconomic Issues of Monetary Unions
Insurance; Insurance Companies; Actuarial Studies
Financial Institutions and Services: Government Policy and Regulation
- Thema
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banking union
deposit insurance
risk-sharing
- Ereignis
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Geistige Schöpfung
- (wer)
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Clemens, Marius
Gebauer, Stefan
König, Tobias
- Ereignis
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Veröffentlichung
- (wer)
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Deutsches Institut für Wirtschaftsforschung (DIW)
- (wo)
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Berlin
- (wann)
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2020
- DOI
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doi:10.18723/diw_dwr:2020-32-1
- Handle
- Letzte Aktualisierung
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20.09.2024, 08:23 MESZ
Datenpartner
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Objekttyp
- Artikel
Beteiligte
- Clemens, Marius
- Gebauer, Stefan
- König, Tobias
- Deutsches Institut für Wirtschaftsforschung (DIW)
Entstanden
- 2020