Comparative Study on the Regulatory Scheme of the Resolution Process of Insolvent Bank - Role Modeling the US Scheme

• Main Authors: Rachel Ci-yan Lin, 林慈雁
• Other Authors: Brian Yi-hong Hsieh
• Format: Others
• Language: zh-TW
• Published: 2006
• Online Access: http://ndltd.ncl.edu.tw/handle/90049942860809160308

碩士 === 東吳大學 === 法律學系 === 94 === The regulatory framework of banking regulations in aspect of closed bank is the main concern of this essay. Resolutions of insolvent banks which is suspended means to force those banks, which are on the edge of insolvency or closure due to poor management and violations of the laws, to close down and to appoint receivers to collect debts and pay off debts. This is last resort and the choices are up to authorities. The procedure of resolutions must be conducted under Due-process of Law and Least-Cost principle to protect the interests of parties involved and minimize the losses of saving insurance funds. Terms of resolution in the Banking Act of the Republic of China are ambiguous for regulated parties to foresee the content. Therefore the terms used in article 62, Paragraph 1, of the Banking Act of the Republic of China shall be more specific. Central Deposit Insurance Corp. (CDIC) is legal receiver. It conducts resolutions of private corporation bodies and is the so-called a legally established legal person delegated by a government agency to exercise government power with respect to certain specifically designated matters in article16 of the Administrative Procedure Act. CDIC are entitled to take administrative acts and allowed to assume the right to manage and dispose of property over resolved banks as a receiver . Supervisors in resolution procedure are delegated by an administrative agency. Courts decide the disputes in administrative procedure. A deposit insurance contract exists between CDIC and resolved banks before resolution. CDIC pays the depositors when insured banks are resolved. Persons legally in charge of banks are responsible for nonperformance of obligation and tort. There are so far no such precedents that a problem bank was settled by the means of resolution mentioned before in our country. Yet it seems to be a necessary measure for those banks with serious financial deficit to exit according to Least- Cost principle. Authorities’ attitude is a key factor in deciding whether to close banks or not and how to do it. Observing the cases in U.S.A., the concerned systematic risk and bank run are not inevitable if the banks are forced to close down for resolution. The cost resulting from procedure is going to accord with Least- Cost principle. The reason why authorities don’t make good use of the resolutions mentioned before which has existed for decades may be political concerns and the reformation of the relevant legal system is not complete. Amend the legal system of the resolutions of insolvent bank which is suspended? Resolve those banks which should have existed ? These are thought-provoking questions for authorities.