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Russia Passes Bank Deposit Guarantee Law

by Tatiana Smolenskaya, for LawAndTax-News.com, Moscow

13 July 2004

Russian lawmakers have passed a bill which guarantees deposits in uninsured banks that fail, it emerged this weekend.

The legislation, which must now be passed by the Federation Council and signed into law by President Vladimir Putin, was passed by 403 votes, with three abstentions. It is expected to come into force in a month, and will also apply retroactively to banks which have failed since February 2003.

Under the new law, deposits of up to 100,000 rubles will be returned within six months, except where the deposit was made by an enterprise that is not technically a legal entity.

Speaking to Reuters, Vyacheslav Reznik, who heads the Duma's Credit Organizations and Financial Markets Committee announced that:

"Approval of this law will ensure that all depositors in banks whose licenses were withdrawn recently have the chance to claim their deposits."

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