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Article: Deposit insurance in developing countries.
- Article from:
- Finance & Development
- Article date:
- December 1, 1990
- Author:
CopyrightCOPYRIGHT 1990 International Monetary Fund. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Deposit Insurance in Developing Countries
In recent years, banking instability has emerged as a major problem in the developing world, prompting the search for ways to protect savers and ensure the viability of banking systems. The distress in the banking systems of many countries now appears to have reached unprecedented levels. It is not unusual for banks in some developing countries to have nonperforming loans that exceed 50 percent of the bank's loan portfolio and several times the bank's capital and reserves. The causes of this considerable distress include: (1) severe external macroeconomic shocks; (2) distortions arising from inappropriate domestic ...