Working Papers

Working papers in this section received financial support from the Research Fund of the Seoul National University Asia-Pacific Law Institute, donated by the Seoul National University Law Foundation.


Sunseop Jung, Macroprudential Regulation and Systemic Insurance Fund : Legal Perspective (2017)

아태법
11 Mar 2020
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정순섭, 거시건전성규제와 ‘시스템적 위기대응기금’에 관한 법적연구, 은행법연구 제10권 2호, 2017.11, pp. 77-108

Sunseop Jung, Macroprudential Regulation and Systemic Insurance Fund : Legal Perspective, Korean Journal of Banking and Financial Law, vol. 10 no. 2, 2017.11, pp. 77- 108

Macroprudential Regulation and Systemic Insurance Fund : Legal Perspective 

Sunseop Jung 

This paper analyzes legal aspect of macrodential regulation and systemic insurance fund. Since 2008 global financial crisis, the importance of marcrodential approach is increasingly emphasized. More strengthened capital rule including counter-cyclical capital buffer may be proper response to the pro-cyclical elements of systemic risks. However, we need additional fund reserves to deal with the elements of interconnectedness in systemic risks. In Korea we have deposit insurance fund and other stand-by funding arrangements to address abrupt occurrence of financial crisis. In 1997 and 2008, these arrangements played a pivotal role to manage financial shocks successfully. However, those funding arrangements are in essence ex post crisis management regime not ex ante crisis prevention. This paper emphasizes the need of precautionary fund reserve arrangements for systemic risks in financial markets. This paper examines several legal issues on the organization and design of systemic insurance fund in Korea.

 Key word : systemic risk, macroprudential regulation, systemic insurance fund, bail-out 


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