A RESEARCH ON SOUND DEPOSIT INSURANCE SYSTEM IN THE POST FINANCIAL RESTRUCTURING FUND ERA
Date Issued
2005
Date
2005
Author(s)
Chen, Lien-I
DOI
zh-TW
Abstract
Since 1997 Asia Financial crises, the Asia countries such as Japan and Korea have being worked hard with financial restructure reform. In Taiwan, influenced by economic and political factors, the government set up the Financial Restructuring Fund (the Fund) in July 2001 to prevent the occurrence of systemic financial crisis and secure depositors confidence. The Fund was also a precedent in Taiwan for the smooth withdrawal of problem financial institutions from the financial market. Up to December 2004 the Financial Restructuring Fund had disposed 46 problem financial institutions, including 1 business bank and 45 community financial institutions. The total amount Fund paid was about NT$104.8 billion. The achievements of the Fund’s hard work and development in various matters have earned widespread public support.
With the coming expiration of the Financial Restructuring Fund on July 10, 2005, the deposit insurance systems should make a thorough reform in responding to the transition to the Post-Fund era which blanket deposit coverage reverts to a limited coverage system. Considering with the financial reforms experiences that USA, Canada, Japan and Korea had made in the post Financial Restructuring Fund Era, the government may summarize some trend and guidance for developing effective deposit insurance system in Taiwan.
The main purpose of my research paper is to encourage general public to get more understanding of deposit insurance system following the expiration of the Fund. The paper also aims to assist Central Deposit Insurance Corporation (CDIC) in conducting its policy and goals of safeguarding depositor rights and interests and stabilizing financial order through the deposit insurance system.
The following points summarize the main conclusions and suggestions of my research paper to help CDIC revise, implement and continually assess a deposit insurance system. These points are reflective of, and adaptable to, a broad set of circumstances, settings and structures.
1. Transitioning from a blanket guarantee to a limit coverage deposit insurance system, CDIC should pay particular attention to public attitudes and expectations, and an emergency plan in case of financial systemic crisis is highly needed, and the insurance coverage limits NT$1 million may need to be adjusted.
2. The Deposit Insurance Act (The Act) should thoroughly revise as soon as possible. Besides, to fulfill CDIC goal function, The Act must determine whether CDIC should be assigned to an existing limited corporation structure or a separate entity should be established to make CDIC be a Risk Minimizer not only a Pay Box.
Subjects
後重建基金時期
金融安全網
存款保險條例
限額保險
存款保險賠款特別準備金
Financial Restructuring Fund
CDIC
Insurance Coverage Limits
Deposit Insurance Act
Risk Minimizer
Pay Box
Type
other
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