Ministry of Finance increases deposit insurance coverage

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Colm Imbert, Minister of Finance –

THE Ministry of Finance announced an increase in deposit insurance coverage, from $125,000 to $200,000 on September 4.

In a media release the ministry said on August 28 Minister of Finance Colm Imbert signed both the Central Bank (Deposit Insurance) Order 2024 and the Central Bank (Deposit Insurance Coverage Ltd) order, which were both published on August 29.

The ministry said in the release both orders will take effect from October 1.

The ministry said the increase in coverage will align coverage levels with the IMF’s recommended ratios for coverage of one-two times GDP per capita, compensate for inflation, keep financial institutions in line with best practices and increase protection for banks in part or in whole who may not be able to pay debts when it is due.

The ministry also announced increases on the premiums levied on financial institutions from 0.2 per cent to 0.3 per cent over a two-year period. The first increase will take effect on October 1 and will bring premiums up from 0.2 per cent-0.25 per cent, with another increase to take place on October 1, 2025.

The increase will ensure the sustainability of the deposit insurance fund, fill the fund’s coffers and provide protection against potential risks and uncertainties.