Russian President signs decree to insure bank deposits

Russian President signs decree to insure bank deposits

Moscow: As part of the government’s efforts to boost confidence in the country’s banking system, Russian President Dmitry Medvedev has signed a bill on insurance of bank deposits, earlier approved by the parliament.

Under the law, which will be retroactive from 1 October the maximum guaranteed amount has been increased to 700,000 roubles ($26,800) from the current 200,000 roubles, according to the Kremlin.

Earlier, Prime Minister Vladimir Putin had said that over 80% bank deposits in the country are below 700,000 and the government is ready to fully repay the losses within days to depositors if their bank collapses.

Speaking in Kyrgyz capital Bishkek last week Medvedev underscored that Russia had taken sufficient measures to shore up the domestic financial market on the backdrop of the ongoing global credit crunch.

Under the anti-crisis package signed into law by Medvedev last night Central Bank and the government are to pump $150 billion in to the financial system, while the finance ministry has already made available about $180 billion worth of liquidity from the budget surplus.

In a major departure from the stated policy, country’s antitrust watchdog said the government’s foreign investment commission had permitted domestic banks to conduct mergers and acquisitions with foreign investors and banks without seeking the commission’s approval.