Rada finance committee approves 100% deposit guarantee coverage during war

23 March, 07:31 PM
Rada supported the order to guarantee 100% banking deposits during the war (Photo:The National Bank of Ukraine \ Flickr)

Rada supported the order to guarantee 100% banking deposits during the war (Photo:The National Bank of Ukraine \ Flickr)

The parliamentary committee on public finance and taxation of Ukraine’s parliament, the Verkhovna Rada, has approved a presidential order to guarantee banking deposits in full during Russia’s war on Ukraine.

The committee recommended that MPs to pass the presidential law to guarantee banking deposits of private individuals at a 100% rate.

The legislation is stipulated in bill No. 5542-1.

This guarantee will be in effect during the period of Russia’s war against Ukraine. The time period of the war will be defined under a special decree, Daniil Getmantsev, the committee’s head, wrote on his Telegram account.

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Bill No. 5542-1 includes the following measures:

  • Guarantees for deposits of private individuals in full, without any limitations on the deposit size, until the end of the war.
  • After the war ends, the official deposit guarantee will cover deposits of up to UAH 600,000.

In Ukraine, the Deposit Guarantee Fund (DGF) is in charge of the banking guarantees policy for private individuals.

Up until now, the DGF covered deposits of up to UAH 200,000 in savings in most banks, while guaranteeing them in full for Oshchadbank, the state-owned savings bank.

Most Ukrainian banks offer their clients deposit accounts in UAH, U.S. dollars and euros, while the interest rate is the highest for the UAH deposits.

Bill No. 5542-1, among other measures, includes a level-playing field principle whichrequires Oshchadbank to join the DGF by on the same conditions as the other Ukrainian banks.

This measure was previously approved by the International Monetary Fund and suggested by the European Bank for Reconstruction and Development.

The promise for full deposit guarantee coverage was made by President Volodymyr Zelensky, who said the government was obliged to do this.

The National Bank of Ukraine, Ukraine’s central bank, and DGF both approved this measure.

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