Blanket guarantee rolled over

05-03-2020

5 March 2020, Baku: As is known, the Law of the Republic of Azerbaijan on Full Deposit Insurance was adopted on 19 January 2016 to safeguard financial stability, maintain banking system resilience and boost public confidence in banks amid global economic developments. According to the Law in question effective from 4 March 2016, all protected deposits with an annual interest rate established by the Board of Trustees of the Deposit Insurance Fund are fully insured for 3 years irrespective their amount. Under the amendments made to the Law on 19 February 2019 the period was extended by one year (until 4 March 2020).

The Financial Stability Board (FSB) of the Republic of Azerbaijan widely discussed re-extension of the Law on Full Deposit Insurance, found it advisable to roll over the Law on Full Deposit Insurance for additional 9 months to more reliably protect interests of depositors and creditors and developed a relevant recommendation. The FSB’s recommendation was supported and the draft Law will be accordingly submitted to the discussion of the Parliament by the relevant legislative authority after the newly selected Milli Majlis starts functioning.

The blanket guarantee period for all protected deposits with the interest rate established by the Board of Trustees of the Deposit Insurance Fund as of the date of attraction is intended to be rolled over by participating banks of the Fund with banking licenses from 4 March 2020 to 4 December 2020 irrespective their amount.