INTERNATIONAL DEPOSIT INSURANCE

The current banking crisis has highlighted the fragility of the international finance system and the extent to which current system safeguards such as IMF action fall short. Envisioning a fuller banking security system leads naturally to the proposal for an international deposit insurance system based on risk-based premiums. This proposal is outlined here as a replacement for "ad hoc" action by national governments and the IMF that is designed to avoid moral hazard while providing an efficient means to international banking security as part of our global financial architecture. Copyright (c) 2009 The Author. Journal compilation (c) Institute of Economic Affairs 2009. Published by Blackwell Publishing, Oxford.