At the same time, the US Federal Deposit Insurance Corporation has become a bastion of sensible thinking on financial sector issues.

Many New Deal programs remain active, with some still operating under the original names, including the Federal Deposit Insurance Corporation (FDIC), the Federal Crop Insurance Corporation (FCIC), the Federal Housing Administration (FHA), and the Tennessee Valley Authority (TVA).

Glass, for his part, opposed deposit insurance.

If such banks fail, they are resolved by the Federal Deposit Insurance Corporation (FDIC) in the normal fashion, and this has always been the market s ex ante expectation.

If they are judged to be insolvent, they are allowed to fail or are taken over by federal authorities, while depositors are made whole by the Federal Deposit Insurance Corporation.

Small town bankers throughout the country wanted government guaranteed deposit insurance, while stronger big city banks feared that government deposit insurance would put them at a competitive disadvantage.

Tom Hoenig, a former president of the Federal Reserve Bank of Kansas City and now a top official at the Federal Deposit Insurance Corporation, advocates separating big banks commercial and securities trading activities.

(Americans, for example, can buy insurance from the Overseas Private Investment Corporation.)

Leaving deposit insurance exclusively at the national level is no longer an option.

In 2007, the Metallurgical Corporation of China won the concession for the Aynak copper deposit in Logar Province.

In the US, for example, Florida s state legislature created the Citizens Property Insurance Corporation in 2002.

It means establishing a common deposit insurance scheme and a mechanism for closing down insolvent financial institutions.

Finally, the revolt of Cyprus s small savers highlighted the need for a credible system of deposit insurance.

But, again, these disclosures did not speak to issues like the desirability of branching or deposit insurance.

Similarly, more than 100 bills for federal deposit insurance had been proposed in the preceding 50 years.

The programme combines development grant funds with concessional loans provided through the Export Finance Insurance Corporation (EFIC).

The bill s proponents argue that this approach builds on the success of the Federal Deposit Insurance Corporation (FDIC), which has a long track record of closing down small and medium sized banks in the US with minimal disruption and no losses for depositors.

The American Bankers Association, worried about the fees that banks would be obliged to pay, vehemently opposed deposit insurance.

Of course, the Germans have reluctantly come to accept the necessity of a banking union that includes common deposit insurance.

That means reaffirming the commitment to deposit insurance, closing unviable banks, and recapitalizing the rest with European (not Cypriot) funds.

Banks are obliged to hold reserves, maintain capital, and pay deposit insurance to ensure that they can honor their deposits.

In 1975, 50 of the property was sold to Prudential Insurance Company forming a partnership with the Hilton Hotels Corporation.

By effectively defaulting on a deposit insurance guarantee through its actions in Cyprus, the eurozone backtracked on the planned banking union.

Governments brought commercial banks under prudential regulation in exchange for public provision of deposit insurance and lender of last resort functions.

But it needs to be a real union, with common deposit insurance and common resolution procedures, as well as common supervision.

That requires an adequate common deposit insurance scheme, which the northern European countries have said is not in the cards anytime soon.

Instead, the initial decision was to confiscate just under 3 billion from accounts containing less than 100,000 the cutoff for deposit insurance.

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That means strengthening the eurozone, which would probably require wider use of Eurobonds and a eurozone wide deposit insurance scheme of some kind.

The irony is that Congress took up the big banks offer to separate commercial and investment banking, but then enacted deposit insurance anyway.

The final bill passed only when its sponsors agreed to combine deposit insurance with new banking regulation, creating a package with something for everyone.

Absolutely not. The provision of liquidity, the recapitalization of banks, more uniform deposit insurance across the advanced countries these were all correct and necessary measures.

And, beyond transfers, will Europeans, or some of them, agree to create a banking union (that is, Europeanization of banking supervision, deposit insurance, and crisis resolution)?

It needs to provide an expanded form of deposit insurance during this time of turmoil, so that there are no more Northern Rock style bank runs.

Yet a common deposit insurance system had, at least so far, not even been under discussion, because the issue was not perceived as a live problem.

The eurozone would be healthier with a properly capitalized banking system that holds diversified assets and is subject to a common supervisory framework and deposit insurance.

Many companies are already involved in offering improved weather insurance to poor farmers, with notable successes from ICICI Lombard and BASIX in India, and from the International Finance Corporation and the insurance company Credo Classic in Ukraine.

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This requires implementing a fully fledged banking union with a pan European supervisor and a strong regime for banking resolution and deposit insurance as soon as possible.

But inflows through money market funds are not so bad for banks, which get the cash without having to set aside reserves or pay for deposit insurance.

Activities include insurance and annuities, life insurance, retirement insurance, health insurance, and property casualty insurance.

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