Korean Deposit Insurance Fund: Some Risk Management Issues

Abstract

The Proliferation of banking and financial crises in the 1980s and 1990s has led a large number of countries to institute an explicit system of deposit Insurance. In fact, 30 of the 72 countries now known to have an explicit deposit insurance system established it during the past decade. Countries implement deposit insurance systems to provide consumer protection for small depositors by providing a mechanism for the immediate pay-out or transfer of the insured portion of their deposits, and to enhance public confidence and systemic stability by establishing a framework fir the resolution of failed institutions to prevent individual bank failures from spreading.