Political party suggests raising sum guaranteed by state if bank deposits become unavailable

The president of the Liberal Democratic Party of Moldova (PLDM), MP Vlad Filat submitted a legislative initiative to the Parliament’s Permanent Bureau. The initiative provides for the amendment of the law on the guaranteeing of individuals’ deposits in the banking sector so as to protect depositors’ interests, Info-Prim Neo reports, quoting a communiqué from the party. The initiative says that the sum guaranteed by the state for every depositor should be increased from 4.500 lei to 5,000 euros, the equivalent in Moldovan lei. “At first sight, the guaranteed sum of 4,500 lei per depositor is close to the average value of a deposit, which is 6,907 lei. In reality, the Deposit Guaranteeing Fund in 2007 covered only 10% of the total deposits made by private individuals. The deposits totaled 14.067,35 billion lei, while the guaranteed deposits – 1.425,36 billion lei,” the informative note to the draft law says. The draft law also says that the Administration Board of the Deposit Guaranteeing Fund must have the right to stop the collections into the fund only after reaching a collections ceiling of 20% of the value of guaranteed deposits. Presently, this ceiling is 7%. “As the fund now makes up 10%, the Board decided to suspend the collections. But, taking into consideration the low ceiling of guaranteed deposits, the insignificant number of banks that form the fund, the possible influence of the world financial crisis on the country’s financial-banking system, the evolution of the Moldovan leu’s exchange rate against the main foreign currencies, it is clear that the 7% ceiling can be insufficient in case of a crisis,” the informative note also says.