Since December 1, 2020, increased thresholds for guaranteed bank  deposits of individuals come into force

ArmInfo.From December 1, 2020, an increased threshold for guaranteed bank deposits will come into force: for AMD deposits, a deposit of 16 million AMD is covered by  the guarantee instead of the previous 10 million AMD, and for foreign  currency deposits - an amount equivalent to 7 million AMD instead of  the previous 5 million AMD. The Union of Banks of Armenia reminds of  this in a message spread on December 1.

According to the amendments introduced to the RA Law "On Guaranteeing  Bank Deposits of Individuals", the following thresholds also apply in  case a depositor has both AMD and foreign currency deposits. So, if  the amount of the AMD deposit exceeds 7 million AMD, then only the  AMD deposit of up to 16 million AMD is guaranteed. And if the size of  the AMD deposit is less than 7 million AMD, then the AMD deposit is  guaranteed in full and the foreign currency deposit in the amount  equal to the difference between 7 million AMD and the amount of the  guaranteed AMD deposit.

These new increased deposit guarantee thresholds also apply to  existing deposit agreements.  The purpose of this law is to help  improve the reliability of the banking system of Armenia and ensure  the protection of the interests of depositors.  The law specifies:  "All deposits of a depositor in the same bank are considered one  deposit, and also applies to foreign currency deposits. And if a  depositor keeps deposits in different banks of Armenia, they are  guaranteed in each bank in the amount of the maximum threshold."  Guaranteed deposits are reimbursed by the Deposit Guarantee Fund.   According to the Financial Rating of Banks of Armenia as of September  30, 2020, prepared by ArmInfo IC, the volume of bank deposits of  individuals (on demand and urgent) exceeded 2 trillion drams ($ 4.1  billion), with a slowdown in annual growth from 13% to 10%. 75% or  more 1.5 trillion drams ($ 3.1 billion) falls on term deposits of  individuals, with an annual growth of 7.1%. In the structure of time  deposits, the share of individuals' funds accounts for 69.6%, against   71.6% a year earlier.