Publisher:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft, Kiel, Hamburg
Abstract:
First, this study empirically explores whether it is possible to offer full insurance for non-financial depositors whilst maintaining market discipline. Second, we analyze whether a more credible deposit insurance scheme can be a competitive advantage for banks in a systemic crisis. We find (1) evidence for market discipline, and (2) banks ceteris paribus achieving higher growth rates of customer deposits in the financial crisis if they are part of a credible deposit insurance scheme.