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Mr. George G. Kaufman and Mr. Steven A. Seelig

immediate access to funds. In Italy, the Interbank Deposit Protection Fund also provided insured depositors with immediate access to their insured deposits. Peruvian depositors have had access to some but not all of their insured deposits in some failures the day after failure, e.g., in the most recent failure in November 1999. In other failures, however, the depositors have had to wait as long as eight months for even the initial payment. According to the Peruvian Deposit Insurance Fund, the factors that determine the speed with which insured depositors get access to

Mr. George G. Kaufman and Mr. Steven A. Seelig
Losses may accrue to depositors at insolvent banks both at and after the time of official resolution. Losses at resolution occur because of poor closure rules and regulatory forbearance. Losses after resolution occur if depositors' access to their claims is delayed or "frozen." While the sources and implications of losses at resolution have been analyzed previously, the sources and implications of losses after resolution have received little attention. This paper examines the causes of delayed depositors' access to their funds at resolved banks, describes how the FDIC provides immediate access, reports on a special survey of access practices in other countries, and analyzes the costs and benefits of delayed access in terms of both the effects on market discipline and depositor pressure to protect all deposits.