Study Of The Deposit Insurance System

With the development of our country's market economy, there will be much competition, which results in financial risk. It is necessary to introduce a deposit insurance system (DIS) to protect depositors' interest, cultivate public confidence in deposit and to sustain safety of financial security.Deposit insurance system was first established in the US in 1930s and since then more than 70 countries in the world have adopted it. At present, deposit insurance legal system is the main part of financial system in most developed nations. In China, banks are facing enormous risk, such as capital deficiency and operation illegal phenomena occur. At the same time, this information dissymmetry exists between banks and depositors. So, depositors felt difficult in banking and finance management. If these problems couldn't be solved, banking failure will injure deposits' interest. So it's necessary to constitute deposit insurance law and set up of deposit insurance system.This paper firstly introduces some factors of DIS such as content, concept, characteristic, operating and so on. By comparing the DIS in different countries and regions, we get some experiences and suggestions. Not only explores the related theories of DIS, this paper but also analyzes its negative effects. It expounds the relationship between DIS and financial stability, financial development, which supplies foundation for policy suggestions.The first chapter of this thesis discusses the basic theory of the legal deposit insurance system. It illustrates the concept, characteristics and the contract of deposit insurance.The second chapter of this thesis analyzes the necessity of establishing Chinese deposit insurance system. It illustrates why China must build up the system.The third chapter proposes some suggestions on the construction of the deposit insurance system in our country in accordance with some relative law and regulations adopted, in light of the experience of the deposit insurance systems in various countries summarized in Chapter Two of this paper. The suggestion mainly concerns the localization of the deposit insurance system of our country, the establishment of the institution of the deposit insurance and financing channel of the institution, application and circulation of the deposit insurance fund, insurance premium rate, and legal applicability issue of the deposit insurance. The conclusion advances the proceeding we must pay attention to. We must set up our own deposit insurance system, instead of copying the practice adopted in other countries.