The Deposit Insurance System And Pricing Research Of Our Country

In order to safeguard the interests of depositors, and create a healthy and competitive banking environment, improve the financial withdrawal mechanism. March 31,2015, the State Council officially announced China "Deposit Insurance", will be officially implemented from May 1. People’s Bank of China is responsible for the deposit insurance system is implemented, the maximum reimbursement limit of 500,000 yuan. After a long process, our country finally established a deposit insurance system. This is China’s financial industry, especially banking, is undoubtedly a great landmark event. Since then, the state government is to serve as the bank’s role is no longer "hidden guarantor", but by the deposit insurance system, making banks more sophisticated management, as well as for the "moral hazard" and "adverse selection" to avoid. Specifically, the deposit insurance system can protect depositors’rights in in case of financial fluctuations and it is mandatory for all banks included in the deposit insurance. And continued smooth operation of the bank’s cash flow will further promote the insurance agency to protect the interests of depositors and thus increase public confidence in the deposit insurance. Even banking crisis bankruptcies, the mechanism of the deposit insurance system will be flexible to compensate depositors for deposits, making banking crisis triggered by the financial turmoil do not cause a large area. However, when the interests of depositors get great protection, depositors do not first consider the nature of the bank. And based on the principle of profit maximization, depositors will choose the bank deposit interest rates higher. From the perspective of the bank, the banks are willing to offer a higher interest rate in the market which is easier to survive, and therefore it disturbs the market order. It is well known banking position in China’s financial sector is very important, it is the main channel for indirect financial banking, while in China, due to the influence of traditional ideas, we have a high savings rate, indirect finance is currently It is one of the main channels of financing. The risk of bank deposit and loan business due to asymmetry, so banks will often face a variety of risks, at the same time, the bank’s risk also contagious, diffusion characteristics, it is easy to spread to other sectors. This means that if the banking sector is unstable, the entire financial industry also will be greater volatility. Of China’s financial industry, the deposit insurance system is undoubtedly a major initiative to maintain stable, however, for the construction of the deposit insurance system and premium pricing, but it is directly related to the initiative as well as the size of the risk of each bank. The premium is too high then easily lead to moral hazard, the premium is too low does not help to shift the risks of banks. This paper begins with the deposit insurance system to start all countries, and in turn, our deposit insurance system comparison, compare the advantages and disadvantages, and finally the impact of premium pricing factors were studied.