Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282456 
Year of Publication: 
2023
Series/Report no.: 
CESifo Working Paper No. 10768
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We employ proprietary data from a large bank to analyze how – during crisis – deposit insurance affects depositor behavior. Our focus is on Belgium where the government increased explicit deposit insurance coverage and implemented implicit deposit insurance arrangements. Estimating sorting below the respective insurance limits shows that depositors are aware of and understand these interventions. Difference-in-differences estimates show that both the increase in the explicit deposit insurance limit and the implicit deposit insurance had the intended calming effect on depositors. Close depositor-bank relationships mitigate these effects, while political trust seems to boost the general effectiveness of such government policies.
Subjects: 
deposit insurance
coverage limit
implicit deposit guarantee
bank nationalization
depositor heterogeneity
JEL: 
G21
G28
H13
N23
Document Type: 
Working Paper
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