Any policy aimed at resolution of a banking crisis determines which constituents - depositors, creditors, shareholders, the banking industry, and society as a whole - eventually bear the costs associated with a banking crisis, thus giving rise to legitimacy and accountability concerns. Rather than what the recent financial crisis has engendered - mostly ad hoc reactions that socialize losses but not profits - what is required, this incisive analysis shows, is an equitable and viable resolution framework, based on burden sharing, enshrined in law, and designed to deal with bank failures in a...
Any policy aimed at resolution of a banking crisis determines which constituents - depositors, creditors, shareholders, the banking industry, and soci...