Real Deposit Insurance Coverage At U.S. Commercial Banks

Authors

Marieta Velikova, Belmont University
Kevin Rogers, Mississippi Stale University

Abstract

Deposit insurance legislation currently being considered by the U.S. Congress proposes to increase the nominal level of insurance coverage for the first time since the passage of DIDMCA in 1980. Since that time, the fixed nominal amount of coverage has resulted in an erosion of the real amount of coverage due to continued inflation. This paper examines the relationship between real coverage and bank risk at individual banks over the last 10 years. The findings suggest that the change in real coverage over time has not been associated with a change in risk at commercial banks. This results implies that legislation proposing to increase nominal and real coverage will not result in increased moral hazard behavior at banks.

Volume

3

Issue

1

First Page

144

Last Page

152

DOI

10.58809/WMQE3392

Comments

For questions contact ScholarsRepository@fhsu.edu

Rights

© Fort Hays State University

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.

Recommended Citation

Velikova, Marieta and Rogers, Kevin (2007) "Real Deposit Insurance Coverage At U.S. Commercial Banks," Journal of Business & Leadership: Research, Practice, and Teaching (2005-2012): Vol. 3: No. 1, Article 18.
DOI: 10.58809/WMQE3392
Available at: https://scholars.fhsu.edu/jbl/vol3/iss1/18