Deposit Insurance in Deposit Insurance in Hong KongHong Kong

Deposit Protection Deposit Protection Scheme in HKScheme in HK

Commencement on 25th of Sept 2006Commencement on 25th of Sept 2006Governing by Deposit Protection Governing by Deposit Protection

Scheme Ordinance (Cap.581)Scheme Ordinance (Cap.581)Compensation limit is set at Compensation limit is set at

maximum HK $100,000maximum HK $100,000

Deposit Protection Deposit Protection Scheme in HKScheme in HKBoth Hong Kong dollar and foreign Both Hong Kong dollar and foreign

currency deposits are protectedcurrency deposits are protectedThe fund will be built up through the The fund will be built up through the

collection of contributions from Scheme collection of contributions from Scheme members members

Differential contributions will be Differential contributions will be assessed based on the supervisory assessed based on the supervisory ratings of individual Scheme membersratings of individual Scheme members

The duties & responsibilities The duties & responsibilities of DPS Boardof DPS Board

Collect premiumsCollect premiums Manage the DIS FundManage the DIS Fund Assess claimsAssess claims Make compensation paymentsMake compensation payments Make rules relating to the Make rules relating to the

procedures for making claims and procedures for making claims and payoutspayouts

The Deposit Insurance in The Deposit Insurance in the worldthe world Total 44 CountriesTotal 44 Countries Albania, Quebec, Morocco, Sudan, Bulgaria, Albania, Quebec, Morocco, Sudan, Bulgaria,

Canada, Canada, TaiwanTaiwan, Romania, Russia, Bosnia and , Romania, Russia, Bosnia and Herzegovina, India, Tanzania, Trinidad and Tobago, Herzegovina, India, Tanzania, Trinidad and Tobago, JapanJapan, Bahamas, Czech Republic, Vietnam, , Bahamas, Czech Republic, Vietnam, Zimbabwe, Kenya, Zimbabwe, Kenya, USAUSA, Nicaragua, Venezuela, , Nicaragua, Venezuela, Colombia, Peru, France, Brazil, Colombia, Peru, France, Brazil, Hong KongHong Kong, , Indonesia, Lebanon, El Salvador, Mexico, Jamaica, Indonesia, Lebanon, El Salvador, Mexico, Jamaica, Jordan, Kazakhstan, Korea, Malaysia, Hungary, Jordan, Kazakhstan, Korea, Malaysia, Hungary, Nigeria, Philippine, Turkey, Argentina, Singapore, Nigeria, Philippine, Turkey, Argentina, Singapore, Sweden, UkraineSweden, Ukraine

Deposit Insurance – USADeposit Insurance – USA

BackgroundBackground

Federal Deposit Insurance Corporation Federal Deposit Insurance Corporation (FDIC)(FDIC)United States government corporationUnited States government corporation

Start in 1933 ( Great Depression )Start in 1933 ( Great Depression )bank runs (4004 banks)bank runs (4004 banks)depositor lose of confidencedepositor lose of confidenceArthur Vandenberg, Henry Steagall Arthur Vandenberg, Henry Steagall

restore confidencerestore confidence

FDICFDIC

Independent agencyIndependent agencyProtect depositor against lossProtect depositor against lossProvides deposit insuranceProvides deposit insurance

taken by bankstaken by banksMeet high standards (financial Meet high standards (financial

strength, stability)strength, stability)

InsuranceInsurance

Insured Insured tradition types of bank accounttradition types of bank account

e.g. checking, saving, trust, CDs etc…e.g. checking, saving, trust, CDs etc… legal limit of $100,000 per depositor per legal limit of $100,000 per depositor per insured bankinsured bank

UninsuredUninsured investment productsinvestment products e.g. mutual funds, stocks, bondse.g. mutual funds, stocks, bonds

Deposit Insurance –Deposit Insurance –TaiwanTaiwan

Deposit Insurance –Deposit Insurance –TaiwanTaiwan

The policy goals:The policy goals:

1.1. Safeguarding the benefits of Safeguarding the benefits of depositors in financial institutions depositors in financial institutions

2.2. Promoting savings Promoting savings

3.3. Maintaining an orderly credit systemMaintaining an orderly credit system

4.4. Enhancing the sound development Enhancing the sound development of financial operations of financial operations

Taiwan Deposit Insurance Taiwan Deposit Insurance SystemSystemLaunchedLaunched September-1985September-1985

Administered Administered byby

Central Deposit Insurance Central Deposit Insurance Corporation (CDIC)Corporation (CDIC)

Maximum Maximum CoverageCoverage

NT$1 million limited to deposit NT$1 million limited to deposit principal per depositor per principal per depositor per insured institutioninsured institution

PremiumsPremiums Paid by member institutionsPaid by member institutions

Premium Premium RatesRates

Risk-based rate system and Risk-based rate system and three rates instituted: 0.05%, three rates instituted: 0.05%, 0.055% and 0.06%0.055% and 0.06%

Participating InstitutionsParticipating Institutions

Domestic banks Domestic banks • including trust and investment companies and including trust and investment companies and

postal savings bankpostal savings bank

Credit cooperativesCredit cooperatives

Foreign bank branches in Taiwan Foreign bank branches in Taiwan • Foreign bank branches whose deposits are Foreign bank branches whose deposits are

protected in their home countries may not protected in their home countries may not participate participate

Insured DepositsInsured Deposits

Checking accountsChecking accounts 支票存款支票存款 Passbook deposits Passbook deposits 活期存款活期存款 Time depositsTime deposits 定期存款定期存款 Savings deposits, including Savings deposits, including postal savings depositspostal savings deposits

儲蓄存款、郵政儲金儲蓄存款、郵政儲金

Uninsured DepositsUninsured Deposits

Foreign currency and foreign exchange Foreign currency and foreign exchange depositsdeposits

外幣、外匯存款 外幣、外匯存款

Negotiable certificates of deposit Negotiable certificates of deposit 可轉讓定期存單 可轉讓定期存單

Structured deposits Deposits from Structured deposits Deposits from government agencies government agencies

各級政府機關存款 各級政府機關存款

Deposits from the Central Bank Deposits from the Central Bank 中央銀行存款中央銀行存款

Deposits exceeding the per-institution Deposits exceeding the per-institution maximum insurance coverage maximum insurance coverage established for each depositor established for each depositor

每一存款人在同一金融機構超每一存款人在同一金融機構超過最高保額部分的存款過最高保額部分的存款

Deposit Insurance –Deposit Insurance –JapanJapan

Deposit Insurance Corporation Deposit Insurance Corporation of Japanof Japan

Established in 1971Established in 1971The limited coverage of The limited coverage of ￥￥ 1 million1 million

April 2002April 2002 The limited coverage of The limited coverage of ￥ ￥ 10 million10 million

Insurance Pay-out Insurance Pay-out methodmethod1.1. Occurrence of insurable contingency.Occurrence of insurable contingency.2.2. Notification of contingency Notification of contingency 3.3. Submission of data on depositors Submission of data on depositors 4.4. Calculation of the insurance (Max: Calculation of the insurance (Max: ￥￥ 10 10

million per depositor )million per depositor )5.5. Decision on payment of the insurance and Decision on payment of the insurance and

details of public announcement details of public announcement 6.6. Public Announcements Public Announcements 7.7. Insurance Payment Notification Insurance Payment Notification 8.8. Claim for the insurance paymentClaim for the insurance payment

Financial AssistanceFinancial Assistance

When a financial institution fails, DICJ When a financial institution fails, DICJ may extend financial assistance may extend financial assistance

Facilitate the transactionFacilitate the transaction

Financial AssistanceFinancial Assistance

Method of financial assistance:Method of financial assistance:Purchases assetsPurchases assetsPartial Business TransferPartial Business TransferMonetary grantMonetary grantSubscribing of Preferred Shares Subscribing of Preferred Shares

SummarySummaryIn Hong Kong, Japan, Taiwan & USA

Summary (1)Summary (1)

The objectives of the deposit The objectives of the deposit insurance systems protect depositors insurance systems protect depositors and contribute to financial system and contribute to financial system stability stability

Legally separate organizations, rely Legally separate organizations, rely on a board of directorson a board of directors

The membership is compulsory and The membership is compulsory and is extended to institutions subject to is extended to institutions subject to effective supervision and regulationeffective supervision and regulation

Covering savings deposit products Covering savings deposit products and excluded coverage of non-and excluded coverage of non-deposit products deposit products

Summary (2)Summary (2)

Funding is provided in some ways such Funding is provided in some ways such as through government appropriations, as through government appropriations, premiums assessed against member premiums assessed against member banks…banks…

To reimburse depositors as quickly as To reimburse depositors as quickly as possible. Reimbursement depends on possible. Reimbursement depends on the bank deposit recordsthe bank deposit records

ConclusionConclusion

SurveySurvey

Date :

29th November, 06 - 10th December, 06

Interviewers :

122 people

Website : http://www.my3q.com/view/viewSummary.phtml?questid=13511

知道66%

不知道34%

您知道什麼是「存款保障基金計劃」嗎您知道什麼是「存款保障基金計劃」嗎﹖﹖

Content of the surveyContent of the survey

您知道「存款保障基金計劃」已經在香港實行嗎您知道「存款保障基金計劃」已經在香港實行嗎﹖﹖

知道60%

不知道40%

Content of the surveyContent of the survey

你認為政府你認為政府 // 金管局對「存保計劃」的宣傳及教育金管局對「存保計劃」的宣傳及教育足夠嗎足夠嗎﹖﹖

足夠19%

不足夠81%

Content of the surveyContent of the survey

您認為此計劃的實行會令您增加對銀行的信心嗎您認為此計劃的實行會令您增加對銀行的信心嗎﹖﹖

會75%

不會25%

Content of the surveyContent of the survey

會61%

不會39%

你會因此而挑選一些已參與「存保計劃」的銀行開你會因此而挑選一些已參與「存保計劃」的銀行開戶存款嗎戶存款嗎 ﹖ ﹖

Content of the surveyContent of the survey

你認為「存保計劃」的監管足夠嗎你認為「存保計劃」的監管足夠嗎﹖﹖

Content of the surveyContent of the survey

足夠45%

不足夠55%

「存保計劃」的存款保障最高只有十萬元，你認「存保計劃」的存款保障最高只有十萬元，你認為足夠嗎為足夠嗎 ﹖ ﹖

足夠26%

不足夠74%

Content of the surveyContent of the survey

$100, 001 -$200, 000

25%

$100, 00019%

$200, 001 -$300, 000

31%

$300, 001 -$400, 000

25%

你認為存款保障金額應該是多少你認為存款保障金額應該是多少﹖﹖

Content of the surveyContent of the survey

有些已參與「存保計劃」的銀行以高息吸引客戶，有些已參與「存保計劃」的銀行以高息吸引客戶，你會因此而將存款轉存於這些銀行嗎你會因此而將存款轉存於這些銀行嗎﹖﹖

會55%

不會45%

Content of the surveyContent of the survey

The The conclusion conclusion

of the of the SurveySurvey

-The End--The End-