LA GARANTIE FRANÇAISE DES DÉPÔTS : UNE ANALYSE EN TERME D'ALÉA MORAL
LA GARANTIE FRANÇAISE DES DÉPÔTS : UNE ANALYSE EN TERME D'ALÉA MORAL

Summary/Abstract: The objective assigned to deposit insurance is twofold. First, it aims at preventing the deposit liquidity risk if a bankruptcy occurs. Secondly, it intends to reduce banks' exposure to systemic risk. However, depositors, bank managers and/or shareholders behavior might be influenced by moral hazard incentives. From this perspective, the French mechanism was not much documented, even though significant changes occurred in the French legal framework. This paper is especially focusing on legal, regulatory and institutional responses to such moral hazard incentives. Moral hazard incentives could be reduced if the following measures were adopted: limits on maximum amounts and scope of deposit insurance; strict liability imposed on managers; as well as the definition of rules for a mandatory intervention of the authorities.

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