Mandate and Functions of the DISB

DISB has a “paybox plus” mandate. This mandate allows for the pay out of depositors when a member institution fails, and involves additional functions, such as monitoring the condition of the banking industry to estimate provision for insurance losses based on aggregate risk of member institutions and taking action to forestall such losses. Other functions of the DISB include:

  • Data Collection, Risk Analysis and Surveillance. The analysis of the data collected helps the DISB determine, among others, risk exposure to the Deposit Insurance Fund (Fund), coverage limit, estimated insured deposits and amounts to be paid to depositors in the unlikely event of failure of a member institution. The DISB also carries out surveillance and continuous monitoring of member institution performance to enable early identification of possible risks that could lead to member institutions failure. Further, the DISB collaborates with other safety net participants (i.e., financial stability council member institutions) on policy formulation, financial crisis preparedness and in the determination of the most appropriate resolution method of a failing or failed member institution.
  • Premium Assessment and Collection. The DISB collects insurance premiums on an annual basis from member institutions to build the Fund to meet its current and future financial commitments. The current premium rate is set at 0.1 percent of the total deposit liabilities of a member institution for the 12 months preceding the date of notice to pay the premium.
  • Administration of the Fund. The DISB has opened a Fund account with the Bank for purposes of depositing premiums contributed by member institutions. The DISB is required to invest monies paid into the Fund in low-risk liquid assets, such as, Government treasury bills and bonds to preserve the Fund capital and for maintenance of liquidity. Additionally, the monies in the Fund may be invested in other securities, as may be determined by the Deposit Insurance Committee.
  • Public Awareness Campaigns. The DISB educates the public about the characteristics of the deposit guarantee, its benefits and limitations on a regular basis using various communication channels.