Deposit insurance and financial
New York, April 2012
• Various schemes introduced by governments in wake of
recent financial crisis to provide financial stability and
to protect depositors.
• Raise a number of questions concerning treatment in
Stability fee and deposit insurance
• Compulsory payments levied by
– May or may not be hypothecated to a special
– Which may or may not be hypothecated only
to support the institutions that pay in to the
• Paid into a consolidated fund (not
hypothecated) = tax
– Or should there be a caveat in cases where the payments into the
fund are broadly equal to expected payouts?
• Paid into hypothecated fund,
– with sums paid in exceeding expected payouts = tax
– with sums paid in broadly equalling expected payouts
= (insurance) service? Or should these always be treated as
taxes for simplicity?
Deposit protection scheme
• Key issue: treatment of priority claims and
acquisition of assets by government to
redistribute to depositors as part of
government’s deposits guarantee
• Any positive difference between assets
acquired by government and redistributed
to depositors = service payment
• Any additional levy imposed by
government to make up for any shortfall =
• Asked to consider proposals
• And whether any additional guidance
should be developed for GFS manual?