Republic of Belarus: Financial Sector Assessment Program: Technical Note: Deposit Insurance
IMF Staff Country Reports, May 18, 2006
Source details
- Canonical URL
- Republic of Belarus: Financial Sector Assessment Program: Technical Note: Deposit Insurance
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Bibliographic details
- Published: May 18, 2006
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781451805239.002
Overview and purpose
- Explains the status of the deposit insurance system in the Republic of Belarus.
- Notes that the current system of deposit insurance is governed by two different pieces of legislation, each elaborated by a separate National Bank of Belarus (NBB) resolution.
- Highlights that reforming a deposit insurance scheme raises the issue of how to achieve a nondisruptive transition.
- States that, independently of whether Belarus chooses a step approach or provides coverage while it reforms its banking system, it will be essential to address the current liquidity shortage.
Key findings
- The deposit insurance framework is fragmented: two different pieces of legislation govern deposit insurance, each further detailed by a separate NBB resolution.
- Reform raises transition risks and the need to design measures that avoid disruption to financial stability.
- A central policy priority is addressing the current liquidity shortage in the banking system, irrespective of the chosen reform path (step approach versus coverage during reform).
Policy considerations and scenarios
- Step approach scenario:
- Implement reforms in stages to limit disruption while strengthening regulatory, supervisory, and resolution frameworks.
- Coverage-while-reforming scenario:
- Provide deposit coverage during banking system reform to preserve depositor confidence, while managing moral hazard and fiscal exposure.
- Across scenarios:
- Essential to resolve the current liquidity shortage as a prerequisite for effective reform implementation.
Subject classification and keywords
- Subject: Bank deposits; Banking; Commercial banks; Deposit insurance; Financial crises; Financial institutions; Financial services; State-owned banks
- Keywords: a number of insolvent bank; bank; Bank deposits; bank fragility; Commercial banks; CR; deposit; Deposit insurance; deposit insurance system; discipline bank; household deposit; insurance; insurance scheme; ISCR; member bank; State-owned banks