Deposit Insurance, Capital Regulations, and Financial Contagion in Multinational Banks
分析跨国银行负债结构如何影响其海外投资，发现资本充足要求会抵消存款保险导致的过度投资，而固定资本要求下分散化会降低存款保险净值，使跨国银行成为金融传染渠道。
Abstract: Banking sector globalization has caused an expansion in foreign‐owned bank assets. In this paper we analyse the effects of a MNB's liability structure upon its investment in a foreign country. We develop a model in which capital adequacy requirements introduce some deliberate underinvestment which counters deposit insurance‐induced overinvestment. Diversification is unattractive with fixed bank capital requirements, because it reduces the expected value of the deposit insurance net. This effect applies in multinational banks (MNBs), where shocks to the home country economy alter the value of the deposit insurance net and hence affect overseas lending incentives. Thus, MNBs act as a channel for financial contagion. We discuss the policy implications of our results.