Friday, 19 April 2024
MAS proposes increasing deposit insurance coverage to around $55,145 (S$75,000)
The Monetary Authority of Singapore (MAS) released a public consultation on its proposals to enhance the Deposit Insurance (DI) Scheme, which insures Singapore dollar deposits held at a full bank or finance company in Singapore.
A key proposal is to increase DI coverage from the current S$50,000 to S$75,000 per depositor. The DI coverage limit was last raised from S$20,000 to S$50,000 in 2011 which, at the time, fully covered more than 90% of insured depositors. Since then, with the growth in deposit base, the percentage of fully-covered insured depositors has fallen to 87%. The proposed coverage limit of S$75,000 will restore the percentage of fully insured depositors to above 90%, in line with international norms.
MAS proposes to achieve the targeted DI Fund size of 30 basis points of total insured deposits in a progressive manner. The plan is to extend the build-up period of the DI Fund from 2020 to 2028, and to revise the annual premium rates levied on full banks and finance companies from 2.0-7.0 basis points to 2.5-8.0 basis points.
Re-disseminated by The Asian Banker
