Period of full deposit insurance in Azerbaijan to be extended

By Trend

The validity period of the full deposit insurance of banks participating in the Azerbaijan Deposit Insurance Fund (ADIF) will be extended until December 4, 2020, regardless of the amount of all protected deposits that are within the annual interest rate on deposits established by the Council of Trustees of the ADIF on the date of attraction, Trend reports referring to the Azerbaijan’s Central Bank (CBA).

The issue of extending the law on full deposit insurance was discussed in the Azerbaijan’s Financial Stability Council.

As a result of the discussions, a corresponding recommendation was prepared on extending the term of the law on full deposit insurance for nine months in order to more reliably protect the interests of depositors and creditors.

The recommendation of the Financial Stability Council was supported. After the newly elected composition of the Parliament enters the office, the bill will be submitted to parliament for discussion by the relevant body that has the right of legislative initiative.

As known, in order to maintain financial stability in the country amid the crisis processes in the global economy, ensure the stability of the banking system and increase the confidence of depositors in it, the law on full deposit insurance was adopted on January 19, 2016.

According to the law, since March 4, 2016, all deposits were fully insured for a period of three years, regardless of the amount, within the annual interest rate established by the Council of Trustees of the ADIF. Then, on February 19, 2019, on the basis of legislative changes, this period was extended for another year, until March 4, 2020.