Banking Crisis and the Design of the Financial Safety Net

Author: Liu Shiyu
Publisher:
Publish Date: 2003-09-01
Features: This book conducts a systematic study on bank crises and the issue of financial safety nets for preventing and managing bank crises. First, it reviews various theoretical models of bank crises to identify common characteristics, mechanisms, and theoretical foundations for preventing and handling crises. Second, it analyzes major bank crisis cases, attempting to test the theoretical models of bank crises with empirical facts and exploring the macroeconomic consequences of bank crises. Third, it systematically analyzes the three components of the financial safety net that suppress crises and mitigate their impact—bank supervision, the central bank's lender-of-last-resort function, and deposit insurance—and preliminarily discusses the allocation of bank regulatory authority. Fourth, it analyzes and evaluates the risk status of China's banking sector and the effectiveness of its financial safety net. Fifth, it proposes institutional arrangements to improve China's financial safety net.