Deposit Guarantee Fund of Ukraine

The Deposit Guarantee Fund of Ukraine was established on September 10, 1998. The initial amount of compensation was only UAH 500.

On September 20, 2001, the Verkhovna Rada adopted the law «On Deposit Guarantee Fund». According to this law the Fund guaranteed compensation of the deposit at the amount of UAH 1,200.[5]     

Since September 21, 2012, the functioning of the Deposit Guarantee System have been regulated by the Law of Ukraine "On the Deposit Guarantee Fund of Individuals" (hereinafter, the Law). The Law formalized that deposit compensation limit could not be less than UAH 200,000.[6] According to the Law, the main task of the Fund is to ensure the functioning of the deposit guarantee system for individuals and the withdrawal of insolvent banks from the market.

In order to fulfill its main task, the Fund performs the following functions:

• maintains a register of participants of the Fund;
• accumulates funds and monitors the completeness and timeliness of the transfer of fees by each participant of the Fund;
• invests the Fund's funds in government securities of Ukraine;
• issues bonds and financial bills;
• takes measures to organize the compensation for deposits in a case of bank liquidation;
• carries out inspections of banks;
• applies financial sanctions to banks and their managers, respectively, and imposes administrative fines;
• carries out the procedure of withdrawal of insolvent banks from the market;
• provides financial support to the bank;

The board of directors is called the Administrative Council consists of five persons, one appointed by the Cabinet of Ministers of Ukraine, two by the National Bank of Ukraine, one by the Verkhovna Rada and the managing director of the Fund ex officio.