Financial Regulation, Solvency, and Credit Risk
Résumé
In order to contain crises, governments in most countries conceive prudential regulations in order to prevent the occurrence of crises and ensure the stability of the financial system. The aim of this chapter is to survey the literature on the perceived fiscal costs of financial crises and discuss the main elements of the financial safety nets. We focus our discussions on the deposit insurance, the lender of last resort function, and the solvency regulations.