Article 3. Purpose and principles of the mandatory deposit guarantee system The Law on Mandatory guarantee of deposits placed in second-tier banks of the Republic of Kazakhstan

Home / Laws / Article 3. Purpose and principles of the mandatory deposit guarantee system The Law on Mandatory guarantee of deposits placed in second-tier banks of the Republic of Kazakhstan

1. The purpose of the mandatory deposit guarantee system is to ensure the stability of the financial system, including maintaining confidence in the banking system by paying a guarantee refund to depositors in the event that a participating bank is deprived of a banking license to carry out all types of operations.

2. The main principles of the mandatory deposit guarantee system are:

1) mandatory participation of banks (branches of non-resident banks of the Republic of Kazakhstan) that accept deposits, open and maintain bank accounts of individuals in the mandatory deposit guarantee system;

2) ensuring transparency of the mandatory deposit guarantee system;

3) reducing the risks associated with the operation of the mandatory deposit guarantee system;

4) the cumulative nature of the formation of a special reserve.

The Law of the Republic of Kazakhstan dated July 7, 2006 No. 169-III.

This Law is aimed at protecting the rights of depositors – individuals, including individual business entities, private notaries, private bailiffs, lawyers and professional mediators, and defines the legal basis for the functioning of the mandatory deposit guarantee system placed in second-tier banks of the Republic of Kazakhstan (bank branches – non–residents of the Republic of Kazakhstan), with the exception of Islamic bank deposits and money in bank accounts raised as part of Islamic banking operations, as well as the procedure for establishing and operating an organization that provides mandatory deposit guarantee, participation of second-tier banks of the Republic of Kazakhstan (branches of non-resident banks of the Republic of Kazakhstan) in the mandatory deposit guarantee system and other issues of mutual relations between participants systems.

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Republic of Kazakhstan

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