On the Necessity and Constraints in the Establishment of Deposit Insurance Institution in China

It is inevitable to establish the deposit insurance institution in China, which is demonstrated from the four respects of financial fragility, the savers' interests protection, the defects of the covert deposit insurance institution and the creation of the impartial competitive environment among banks. However the establishment of the deposit insurance institution is also constrained by such factors as institution itself, banking capital, assets and information release. It can release the constraints to establish reasonable deposit insurance system, realize the securitization of deposit insurance, increase the bank self-owned capital and enhance the marketability of bank assets.