| Summary: | 碩士 === 東吳大學 === 法律學系 === 105 === This paper relates “ how to protect depositors more effectively than the enforcement of financial safety net ”. The existence of “information asymmetry ” poses important problems for the depositors to supervise bank managers’ action, since the bank managers are easy to perform some act which breach the duty of loyalty, and that action are hard to be detected. Also, the Deposit Insurance System also brings some Moral Hazards. On the one hand, depositors would rely the existence of financial safety net, and ignore the duty to supervise. On the other hand, the bank manager would prefer to perform some risky strategy in managing the bank other than the low risk one. If it works, the bank will earn. However, if it fails, the depositor loses. The existence of financial safety net could provide part protection effectiveness, but it barely solve the problem of agency theory.
A well-designed Deposit Insurance System not only provide the protection of depositor, also maintain the stability of banking system. Nevertheless, the Deposit Insurance System could bring some problem as well, such as moral hazard and adverse option. Thus, how to avoid those situation is another important issue.
In a market where the market statistic is used to decide the quality of merchandise, the market mechanism would accurate the price of goods. However, if it’s not easy for the customers to get the merchandise information, there would be a lemon market. Thus, information disclosure would be an important mechnism to achieve bank transparency. It should be perceived that in talking about information disclosure, how do an unsophisticated person use the professional insider information effectively is also an issue. Therefore, the two tier information disclosure mechanism is a method to illustrate and develop these thoughts. It should be emphasized that these information intermediaries is chosen for its concreteness , ease in understanding and for its realism.
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