Policy Design, Analysis, and Evaluation Commons^™

Brazil: Reserve Requirements, Gfc, Sean Fulmer

Journal of Financial Crises

After the collapse of Lehman Brothers in September 2008, deposits began to accumulate at large Brazilian banks, representing a flight to safety away from small and medium-sized banks. While total deposits in the Brazilian financial system grew by 13% from August 2008 to January 2009, the total deposits held by small and medium-sized banks declined by 23% and 11%, respectively. Because of high statutory reserve requirements and legal disincentives to lend directly to financial institutions, the Central Bank of Brazil (BCB) used reserve requirements as its primary tool for providing liquidity to incentivize large banks to provide credit to smaller …

Thailand: Fidf Blanket Guarantee, 1997, Ayodeji George

Journal of Financial Crises

The Thai government’s decision to allow the baht to float in July 1997 was the pivotal event of the Asian Financial Crisis. The baht fell 20% by the end of the month, further pressuring Thai financial institutions that had borrowed heavily in US dollars and other foreign currencies. In early August, Thailand’s Finance Minister and the Bank of Thailand (BOT) announced the suspension and restructuring of insolvent finance companies and a blanket guarantee covering depositors and creditors of all domestic banks and the remaining finance companies, administered by the BOT’s Financial Institutions Development Fund (FIDF). However, the blanket guarantee was …

Mexico: Fobaproa Blanket Guarantee, 1993–1994, Stella Schaefer-Brown

Journal of Financial Crises

On December 22, 1994, the Mexican government allowed the peso to float freely against the US dollar, aggravating the run on peso deposits, leading to the rapid devaluation of the peso, and sparking the peso crisis. The following week, the Bank of Mexico announced that the Mexican deposit insurer would fully guarantee all commercial bank deposits and liabilities except subordinated debt. The announcement of the blanket guarantee appeared effective at reassuring foreign investors, as the central bank was soon able to ease the liquidity support that it had been providing to banks during the crisis. The government created a deposit …

Sweden: Bank Support Authority, Blanket Guarantee, 1992, Anmol Makhija

Journal of Financial Crises

Following a period of rapid financial liberalization and a record credit boom in the 1980s, Sweden’s financial system suffered its worst shock in the post–World War II period. Swedish banks were heavily dependent on foreign credit, which dried up amid signs of instability. The Swedish government announced a blanket guarantee on September 24, 1992, for all banks’ obligations except share capital and perpetual subordinated loans. According to a 1995 IMF Working Paper by Drees and Pazarbasioglu, the purpose of the blanket guarantee was “to guarantee the stability of the payments system and to safeguard the general supply of credit.” The …

Korea: Blanket Guarantee, 1997, Bailey Decker

Journal of Financial Crises

Korea entered the Asian Financial Crisis in August 1997 with highly leveraged firms and a banking system inexperienced in managing systemic risk. Korea faced a currency crisis and a banking crisis, as foreign banks froze credit to Korean commercial banks and merchant banks. On August 25, 1997, the Ministry of Economy and Finance (MOEF) announced that it would guarantee all Korean financial institutions’ foreign debt—both existing debt and new borrowings. Nonetheless, foreign lenders continued to withdraw credit from Korean financial institutions. On November 19, 1997, a newly appointed MOEF minister announced a suite of measures to promote foreign creditors’ confidence …

Jamaica: Finsac Blanket Guarantee, 1997, Ayodeji George

Journal of Financial Crises

After a period of sustained distress in the early 1990s, Jamaican financial institutions faced significant liquidity issues by 1996, evidenced by runs on banks by depositors. The government responded by creating the Financial Sector Adjustment Company (FINSAC) on January 29, 1997, to rehabilitate weak financial institutions and administer a blanket guarantee on financial sector liabilities. The blanket guarantee covered all deposit-taking financial institutions, life insurance policy providers, and pension funds registered under the Banking Act, Financial Institutions Act, and Insurance Act. Within eligible institutions, the blanket guarantee covered depositors’ funds in licensed deposit-taking institutions, pension funds managed by authorized institutions, …

Ireland: Credit Institution (Financial Support) Scheme, 2008, Stella Schaefer-Brown

Journal of Financial Crises

The Global Financial Crisis exposed fragilities in the Irish banking system and led to widespread runs on Irish banks. Irish authorities attempted to address the runs on September 22, 2008, by increasing the country’s deposit guarantee limit from EUR 20,000 to EUR 100,000 (USD 28,800 to USD 140,000) and raising the coverage of deposits from 90% to 100%. When the runs continued, the Irish minister for finance announced a blanket guarantee of bank liabilities on September 30 without consulting European Union authorities. The announcement specified the blanket guarantee would be effective immediately and remain in effect for two years. The …

Indonesia: Blanket Guarantee, 1998, Ayodeji George

Journal of Financial Crises

The Indonesian government closed 16 banks on November 1, 1997. At the time, the government said it would guarantee depositors up to 20 million Indonesian rupiah (IDR; USD 6,000) per account. The lack of immediate full protection for large depositors caused deposit runs throughout the banking sector and undermined foreign confidence in the Indonesian financial system. In response, the Indonesian president on January 26, 1998, announced a blanket guarantee and created the Indonesian Bank Restructuring Agency (IBRA) to administer the guarantee and other bank rehabilitation efforts. The blanket guarantee covered all depositors and nonsubordinated creditors in locally incorporated commercial banks. …

Ecuador: Blanket Guarantee, 1998, Bailey Decker

Journal of Financial Crises

After a series of exogenous shocks hit the Ecuadorian economy in 1997–1998, foreign creditors reassessed their emerging-market risk and reduced external credit lines to Ecuador, thus draining liquidity. The closure of a small bank called Solbanco in April 1998 triggered deposit runs at other banks. Banks sought assistance from the Central Bank of Ecuador (Banco Central del Ecuador, or BCE). By the end of September 1998, the BCE had issued emergency loans to 11 financial institutions, totaling nearly 30% of the money base. The crisis accelerated in August 1998 when Banco de Prestamos, the sixth-largest bank, was closed; the existing …

Finland: Government Guarantee Fund, Blanket Guarantee, 1992, Anmol Makhija

Journal of Financial Crises

Following a period of rapid financial liberalization and a record credit boom in the 1980s, Finland’s financial system suffered steadily increasing loan losses and falling earnings beginning in 1990. The Finnish Parliament created the Government Guarantee Fund (GGF) in April 1992 to support banks with loans, capital, and guarantees. In a press release issued on August 6, 1992, the government said the GGF would “secure the stable functioning of the banking system under any circumstances [emphasis added]”. Six months later, the Parliament of Finland specifically required the GGF to guarantee that all Finnish banks could meet their commitments. The government …

Denmark: General Guarantee Scheme, 2008, Benjamin Hoffner

Journal of Financial Crises

As foreign credit in Denmark dried up during the summer of 2008, Danish banks became increasingly reliant on short-term borrowing. The government took over the failing Roskilde Bank, the country’s eighth-largest bank, in late August. On October 5, 2008, the government announced a voluntary General Guarantee Scheme to fully insure deposits and other senior liabilities of participating banks. Banks could participate in the scheme by becoming members of the financial sector’s banking consortium, Det Private Beredskab, or in English, the Private Contingency Association (PCA), before October 13, 2008. The General Guarantee Scheme fully insured all depositors and senior unsecured creditors …

Blanket Guarantees Survey, Christian M. Mcnamara, Carey K. Mott, Greg Feldberg, Andrew Metrick

Journal of Financial Crises

This paper surveys 10 blanket guarantee (BG) programs across 13 Key Design Decisions. The defining characteristics of these programs in terms of their inclusion in our BG series are (a) that they guaranteed a broader range of liabilities beyond deposit accounts and (b) that the guarantees covered existing liabilities in addition to newly issued ones. Each case represents an effort to eliminate creditors’ incentive to withdraw funding from institutions by guaranteeing that the funding will be paid back even if the institutions are unable to do so themselves. The main themes that emerge are: (a) the inability of blanket guarantees …

Reserve Requirements Survey, June Rhee, Carey K. Mott, Greg Feldberg, Andrew Metrick

Journal of Financial Crises

Banks have a private motive to hold some level of cash and liquid reserves, but the negative externalities of bank runs create a public interest in setting a regulatory level higher than the privately optimal level. We can think of such reserve requirements (RRs) as the original form of liquidity regulation. In this paper, we focus on 14 cases in which central banks adjusted RRs after crises hit, typically to deal with liquidity shortages in the banking system. We observe that RR adjustments have several advantages in a crisis: (1) such changes require little process, and the change for banks …

The Financialization Of Recession Response, Aaron Klein

Journal of Financial Crises

This paper analyzes economic policy responses to the COVID-19-induced recession, focusing on the American policy response. Despite widespread political distrust between the two parties sharing control of the government and the timing of the upcoming presidential election, America’s political system was able to enact a massive policy response that reduced the severity of the recession. This political response happened faster than any automatic policy response would have, based on the delays in data reporting. The economic policies enacted continued America’s trend toward financialization of fiscal policy. The Federal Reserve and America’s private banking and financial systems were heavily relied upon …

Recommendations For Sustainable Tourism In Patagonia: An Exploratory Analysis Of Sustainable Tourism In Costa Rica, The Nordic Region, And Thailand’S Communities, Julia K. Lowery

Undergraduate Honors Theses

This thesis explores different levels of governance and its role towards actualizing sustainable tourism in Patagonia. With the growing threat of climate change, international destinations such as Patagonia are looking to continue building their tourism industries in a sustainable way. Through analyzing case studies of national governance in Costa Rica, multi-national governance in the Nordic region, and community-based tourism in Thailand, we can better understand how each form of governance has the potential to create a sustainable tourism industry. With this understanding of successful governance in my case studies, as well as understanding the historical and political forces that have …

The Future Of Universal Basic Income: The Impact Of Organizational Strategies On Alleviating Poverty And Maximizing Outcomes, Anna Mathews

Undergraduate Honors Theses

Universal basic income is gaining traction, with pilot programs being conducted all over the world. These programs are all organized differently, from their sources of funding to their eligibility criteria. This research draws correlations between organizational strategies of UBI programs and the outcomes their recipients experience. Specifically, it analyzes three contemporary UBI programs within the United States: the Stockton Economic Empowerment Demonstration (SEED), Alaska Permanent Fund Dividend (APFD), and the Eastern Band of Cherokee Indians per capita payments (EBCI). The research assesses the physical health, mental health, and economic outcomes of the participants in each case study, in order to …

Rural Health Action Network Enhanced Outreach Initiative. Year One Final Report, Mary Lindsey Smith Phd, Karen Pearson Mlis, Ma, Evelyn Ali Bs

Substance Use Research & Evaluation

Healthy Community Coalition (HCC), in coordination with the Rural Health Action Network (RHAN) of greater Franklin County, is implementing a multi-faceted outreach program to improve health outcomes among the rural poor living with chronic conditions in greater Franklin County, Maine.

The goals of the Franklin County Rural Health Action Network Enhanced Outreach Initiative (RHAN-EOI) include:

• Expand access to quality services;
• Expand training for community health extenders;
• Decrease hospital admissions, emergency department use, and costs; and
• Improve communication and care coordination across project partners

This report highlights the implementation and progress of HCC RHAN in Year 1. For more information, please …

Medication Assisted Treatment: Prescription Drug And Opioid Addiction Expansion Project, Mary Lindsey Smith Phd, Katharine Knight Mph, Mark Richards Bs, Tyler Egeland Ba, Evelyn Ali Bs

Substance Use Research & Evaluation

Greater Portland Health (GPH) in collaboration with Preble Street Resource Center was awarded a Medication Assisted Treatment: Prescription Drug & Opioid Addiction (MOUD-PDOA) grant from SAMHSA. The GPH MOUD-PDOA project will include a mixed-methods evaluation led by Catherine E. Cutler Institute. The evaluation team will build knowledge and provide feedback to inform the implementation and refinement of the GPH MOUD-PDOA Program.

Evaluation Goals:

• Document program strategies and identify barriers and facilitators to implementation
• Examine the efficacy of using a continuum of treatment services to increase access to MOUD among vulnerable populations in underserved communities
• Assess the impact of the intervention …

Questioning China’S Peaceful Development: A Mahanian Sea Power Analysis Of Blue Water Navy Accumulation, Patricia Patricia, Putu Agung Nara I.P. Satya

Global: Jurnal Politik Internasional

China has been rapidly accumulating naval capabilities for nearly 4 decades with the ambition of pursuing blue-water-navy forces through its People’s Liberation Army Navy (PLAN). With its peaceful development policy, the acquisition of such powers has been interpreted as an anomaly and therefore resulted in an increase of security dilemmas between states. In the quest for explanations behind China’s actions, multiple scholars have examined this phenomenon by utilizing offensive realism, defensive realism, and Tirpitzian non-hegemonic naval theory. Thus, this paper brings another perspective by applying the Mahanian Sea Power approach. Consequently, the analysis established that China’s pursuit of blue-water-navy is …

Effect Of Covid-19 Pandemic On Volunteerism And Fundraising Management Strategies In Nonprofits And Rebuilding Tactics Of Ronald Mcdonald House Charities Of Chicagoland And Northwest Indiana (Rmhc-Cni), Humza Wolf

Student Capstone Projects

The financial sustainability of nonprofits depends highly on volunteerism and funding strategies which got impacted during Coronavirus 2019 (COVID-19) Pandemic. This capstone study explores to what extent nonprofits got affected and evaluates the efforts of Ronald McDonald House Charities of Chicagoland & Northwest Indiana (RMHC-CNI) to improve the provision of support for underprivileged families of critically ill children. The continual efforts to overcome financial hurdles escalated in pandemic. Mixed method research design was used to collect, analyze, and triangulate both quantitative and qualitative research methods in this single study to understand the research problem. Interpretive approach encompassed the complexities of …