Deposit insurance has not worked well in countries with Question 2 options: A) few opportunities for corruption. B) a tradition of the rule of law. C) a weak institutional environment. D) strong supervision and regulation.

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02-03-2020
Social Studies

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Deposit insurance has not worked well in countries with Question 2 options: A) few opportunities for corruption. B) a tradition of the rule of law. C) a weak institutional environment. D) strong supervision and regulation.

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Answer: A weak institutional environment.

Explanation: In countries with a weak institutional environment, deposit insurance has not been efficient. Deposit insurance is a measure put in place by many countries to protect bank customers deposits. it can either be in full or part, from losses caused by a bank's failure to pay its debts as at when due. A deposit insurance system has contributed positively to the stability of a nation’s financial system if it is part of a well-designed safety net.