Putin signs law raising deposit insurance to 1.4 million rubles
MOSCOW, December 29 (RAPSI) – President Vladimir Putin on Monday has signed a federal law to double deposit insurance to 1.4 million rubles ($25,000) if a bank fails, says a document posted on the government’s legal information website.
The authorities discussed increasing deposit insurance to 1 million rubles last year, but postponed the issue until 2015. Industry experts proposed increasing deposit insurance to 1.5 million.
The bill Putin has signed also amends the law on the Central Bank to allow the regulator to issue a subordinated loan to Sberbank that will not exceed Sberbank’s own capital as of January 1, 2015, in order to support the Russian banking system.
The law also says that the Deposit Insurance Agency (DIA) will be able to increase the banks’ market value (excluding Sberbank) by transferring the government’s federal bonds to the banks in the form of subordinated loans and to use these bonds to repay the banks’ subordinated bond loans.