Deposit insurance Luxembourg
Switzerland has a privately operated deposit insurance system called
Deposit Protection of Swiss Banks and Securities Dealers. It
guarantees up to CHF 100 000 per bank customer per bank. Membership is
compulsory for all banks and securities dealers that are regulated by
the Swiss Financial Market Supervisory Authority (FINMA). See the
list of members of the Deposit Protection of Swiss Banks and Securities
dealers at http://www.einlagensicherung.ch/en/bankkunden-link/bankkunden-unterzeichner.htm
It had covered depositors in 1993 in the case of the failure of Spar-
und Leihkasse Thun SLT, Thun. The next cases happened in 2007 with the
liquidation of AB FIN SA (a securities dealer) in Lugano and with
Kauphting (Luxembourg) SA, Geneva branch which was closed on October 9,
2008. Clients of this bank received the payments (at the time up to CHF
30 000 per customer) within three weeks.
For further information see the FAQ at http://www.einlagensicherung.ch/en/bankkunden-link/bankkunden-faq.htm
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Deposit insurance can be
in two forms. There is implicit deposit insurance , where
there are no stated rules but depositors have assurances
implied by governments’ action either through precedence or
stated intention. Then there is explicit deposit protection,
where the terms and conditions of the scheme are explicitly
stated in a statute. The scheme provides a legally
enforceable guarantee on all, or a portion of the principal,
and in some cases the interest, on a deposit. Under an
explicit scheme, the statute states categorically the types
of deposits that are covered in the event of bank failures.
Table 1 shows countries with explicit and implicit deposit
insurance schemes. It should be noted that some countries
continuously modify their schemes in response to
developments in their financial system.
The types of institutions covered are also influenced by the
objectives of the scheme. Where the objective is to protect
the entire banking system, as is the case with Jamaica, the
legislation requires that all banks be covered. Where the
aim is broad, most types of deposits are covered. Table 2
shows the main features (date established, whether the
scheme is voluntary or compulsory, types of deposits covered,
coverage limit, funding and premium base) of explicit
deposit protection schemes in a number of countries.
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