Supplementing regulations on payment of all insured deposits

The draft supplements regulations on the payment of all insured deposits of depositors in case the credit institution is placed under special control and implements a recovery plan according to the Law on Credit Institutions.

State Bank Governor Nguyen Thi Hong presented a report at the meeting.

On the afternoon of September 22, the National Assembly Standing Committee (NASC) gave its opinion on the draft Law on Deposit Insurance (amended).

Presenting a report at the meeting, State Bank Governor Nguyen Thi Hong said that the draft Law on Deposit Insurance (amended) aims to better protect the rights of depositors and ensure the stability of the financial system.

One of the most important changes is to adjust the insurance payment limit to be more flexible, instead of fixed as at present. The draft regulation stipulates that the Governor of the State Bank will decide the insurance payment limit in each period.

The draft also stipulates a shortening of the time for preparation and payment of insurance money when payment obligations arise. Specifically, within 45 working days from the time the obligation arises, the deposit insurance organization must be responsible for paying insurance money to the insured depositor.

“This regulation ensures that depositors are paid earlier and more promptly, helping to reduce their financial difficulties in case a credit institution encounters problems,” the female Governor explained.

View of the meeting

In particular, the draft adds provisions on the payment of all insured deposits of depositors in cases where credit institutions are placed under special control and implement recovery plans according to the decision of the Law on Credit Institutions. This payment limit may exceed the normal limit. This is a breakthrough policy, aiming to protect the interests of depositors to the maximum in situations of systemic risk, contributing to preventing the risk of collapse and maintaining the safety of the banking system.

Regarding organizations participating in deposit insurance, the draft expands the investment forms of deposit insurance organizations. In addition to buying and selling government bonds, deposit insurance organizations can also invest in bonds and deposit certificates issued by commercial banks with more than 50% state capital.

The draft also adds rights and obligations for the deposit insurance organization to participate more deeply in the process of early intervention, special control, and handling of incidents and crises of credit institutions. The deposit insurance organization can make special loans to credit institutions under special control, with 0% interest rate and no collateral required in certain cases.

Along with that, to have a basis for applying a flexible fee mechanism, the draft adds regulations on the refund of deposit insurance premiums incurred before the time of placing credit institutions under special control. The Governor of the State Bank will prescribe the fee level and the application of differentiated fees in accordance with the credit institution system in each period.

Presenting the review viewpoint, Chairman of the Economic and Financial Committee Phan Van Mai noted that assigning the Governor of the State Bank to regulate the insurance payment limit in each period is appropriate, but there should be specific guidance on the principles for adjusting the insurance payment limit.

“For overpayments, it is necessary to clearly define the basis for determining “special cases” requiring overpayments, and to study a transparent approval process with the participation of relevant agencies such as the State Bank and the Ministry of Finance…”, Mr. Phan Van Mai emphasized. The auditing agency also requested to clarify the consistency between the deposit insurance premium balance and the insurance amount paid.

MR. PHUONG

Source: https://www.sggp.org.vn/bo-sung-quy-dinh-ve-viec-chi-tra-toan-bo-cac-khoan-tien-gui-duoc-bao-hiem-post814169.html