Adapting International Experience to the Deposit Guarantee System in Ukraine

Abstract

The research objective of the article is the substantiation of methodological and applied recommendations for improving deposit guarantee system in Ukraine in view of the international experience. The study object is the deposit guarantee system management in the framework of reforming the Ukrainian legislation aimed at establishing a mechanism of deposits guaranteeing. During the research there were used such methods as: dialectical method and methods of analysis and synthesis -to study the features of deposit guarantee systems of developed countries, the characteristics of mechanism for returning deposits and international law peculiarities; statistical method -to analyze the indicators of banking system in Ukraine and credit unions (CU), for empirical determining CU to banks indicator ratio as well; structural and logical analysis -to develop theoretical and methodological principles of forming effective deposits guaranteeing mechanism in Ukraine. The need to ensure the system of deposits guaranteeing not only to individuals but also to individual-private entrepreneurs and legal entities was established. This will facilitate the development of small and medium businesses in the country. There were analyzed peculiarities of credit unions activity in Ukraine in the context of reforming the banking system. The possibility of including the credit unions to the deposit guarantee system of Ukraine by the example of the EU countries and the world was substantiated. There were characterized necessary amendments to the national legislation in the field of deposit guaranteeing and the effective mechanisms for their implementation were proposed.

Deposit insurance fund and the quality of risk assets of Nigerian deposit money banks

“…DIF is an accumulated fund built over time by designated deposit insurers arising from premium collection from insured financial institutions. Principally, the fund is employed in the process of resolving the challenge of failing and failed financial institutions and for the timely and prompt reimbursement of depositors' claims (Alyeksyeyev & Mazur, 2018). According to Anginer and Demirgüç-Kunt (2018), deposit insurance has a widespread global adoption and has become an integral element of the financial safety-net offered by most governments to salvage their respective banking systems.…”

“…Nigeria, through the central bank responded in this direction by reinforcing the existing Deposit Insurance Scheme (DIS) and putting in place, support programs for banks that made provisions for liquidity, government guarantees of all deposits, interbank lending and the recapitalization of ailing banks through the Asset Management Corporation of Nigeria (AMCON). DIS, also referred to as deposit guarantee system (Alyeksyeyev & Mazur, 2018) is a mutual insurance system funded by insured banks and administered either through privately held agencies or through government-controlled agencies that guarantees depositors funds that are held in the insured financial institutions/banks (Ume, Oleka & Obasikene, 2017;Ani & Ogar, 2018). Usually, in the event of total collapse or failure on the part of any insured bank, depositors are promptly reimbursed where the DIS in place is effective and efficient.…”

“…Equally, it is disheartening to observe that given the plethora of studies conducted on DIF, majority of prior researches concentrated mostly on developed economies of Latin America, the United States of America (USA), Great Britain, and the European Union (McCoy, 2006;Eisenbeis & Kaufman, 2006;Bernet & Walter, 2009;Khundadze, 2009;Jalan & Pradhan, 2012;Hogan & Luther, 2014;Glonti & Vashakmadze, 2018;Alyeksyeyev & Mazur, 2018;Jameaba, 2018;) with very few empirical researches on economies in sub-Saharan Africa (Ani & Ogar, 2018;Cheng & Ellyne, 2011;Anyanwu, 1997). This scenario is somewhat regrettable bearing in mind that a substantial number of African countries established some form of explicit DIS often arising from policy recommendations of international renowned financial experts (Demirgüç-Kunt & Kane, 2002).…”

Deposit insurance systems of post-Soviet countries: A comparative analysis

“…In particular, the respective Ukrainian legislation of 2012 on responsibilities of the national Deposit Guarantee Fund and its amendments are considered. Although Ukraine has experienced several amendments to legislation on banking activity, banking regulation and deposit insurance during recent years, the aforementioned legislation does still represent the relevant legal foundation of Ukrainian deposit insurance (Alyeksyeyev & Mazur, 2018). Section six concludes this article.…”