Prepare an assessment of the role of Deposit Insurance Institutions in the Caribbean financial markets.  1. History of Deposit Insurance in the Caribbean. 2. Discussion on instances where deposit insurance was paid to depositors of financial institutions. 3. Critical analysis of the benefits and costs of deposit insurance including moral hazard and if the system can function effectively without deposit insurance.

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Regulation of Commercial Banks

The main function of any commercial bank is accepting deposits and lending money to borrowers. Apart from these two activities, commercial banks provide a host of other services to their customers, like discounting bills of exchange, acting as a custodian of a customer's will, and so on. In the absence of a proper regulatory framework or proper regulations in place, the commercial banks would have ended up charging exorbitant or varied rates of interest or service charges on the funds loaned by them or the services performed by them.