Savings Insurance Corporation to be established

Feb 19 • Banking, Business, Economy, Finance, News • 1849 Views • No Comments on Savings Insurance Corporation to be established

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Mongolian parliament passed a Savings Insurance Law on the 10th January, 2013. Within the framework of the new law, a task force with representatives from Ministry of Finance and the Mongol Bank has been established to set up a Savings Insurance Corporation in Mongolia. The key objective of this new organization will be to insure the money saved by citizens in the commercial banks.

In accordance with the savings insurance law, savings no more than MNT 20 Million will be protected from potential risks. In other words, in case a bank goes bankrupt, people who had savings less than MNT 20 Million would be entitled to receive a reimbursement from the Savings insurance corporation.

99% of the individual holders of the savings at Mongolian banks maintain savings at or below MNT 20 Million. Therefore, the law states that the maximum amount of money a client can be claim will be MNT 20 Million.

It has been decided by Ministry of Finance and Mongol Bank that MNT 50 Billion will be allocated to the new corporation. Also, it is expected that it will receive approximately MNT 100 Billion from the commercial banks as insurance fee, in accordance with the law.

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