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Post-resolution treatment of depositors at failed banks: implications for the severity of banking crises, systemic risk, and too big to fail

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  • George G. Kaufman
  • Steven A. Seelig

Abstract

Losses from bank failures have significant adverse implications for bank stakeholders, as well as for the macroeconomy. This article examines the potential sources of such losses, in particular the losses that may occur after the date a bank is failed, and makes recommendations on how to minimize these losses.

Suggested Citation

  • George G. Kaufman & Steven A. Seelig, 2002. "Post-resolution treatment of depositors at failed banks: implications for the severity of banking crises, systemic risk, and too big to fail," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 26(Q II), pages 27-41.
    • Handle: RePEc:fip:fedhep:y:2002:i:qii:p:27-41:n:v.26no.2
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    References listed on IDEAS

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    Cited by:

    1. Glenn Hoggarth & Jack Reidhill & Peter Sinclair, 2004. "On the resolution of banking crises: theory and evidence," Bank of England working papers 229, Bank of England.
    2. George G. Kaufman, 2003. "A proposal for efficiently resolving out-of-the-money swap positions at large insolvent banks," Working Paper Series WP-03-01, Federal Reserve Bank of Chicago.
    3. DeYoung, Robert & Kowalik, Michal & Reidhill, Jack, 2013. "A theory of failed bank resolution: Technological change and political economics," Journal of Financial Stability, Elsevier, vol. 9(4), pages 612-627.
    4. William J. Bergman & Robert R. Bliss & Christian A. Johnson & George G. Kaufman, 2004. "Netting, financial contracts, and banks: the economic implications," Working Paper Series WP-04-02, Federal Reserve Bank of Chicago.
    5. Robert A. Eisenbeis & George G. Kaufman, 2007. "Cross-border banking: challenges for deposit insurance and financial stability in the European Union," FRB Atlanta Working Paper 2006-15, Federal Reserve Bank of Atlanta.
    6. George G. Kaufman, 2003. "Depositor liquidity and loss-sharing in bank failure resolutions," Working Paper Series WP-03-02, Federal Reserve Bank of Chicago.
    7. Hoggarth, Glenn & Jackson, Patricia & Nier, Erlend, 2005. "Banking crises and the design of safety nets," Journal of Banking & Finance, Elsevier, vol. 29(1), pages 143-159, January.

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