YEREVAN. – You can greatly increase the amount of bank deposit insurance, but it is difficult to put that payment on the banks because it affects the interest rates, and as a result, you will have a system that when the problem actually arises, it will become an obligation on the state budget. Nerses Yeritsyan, Deputy Governor of the Central Bank of Armenia, said this during Tuesday’s parliamentary debates on the bill on amendments to the law on guaranteeing compensation for bank deposits of individuals.
He noted that no political decision is made regarding other insurance tools regarding their amount.
Referring to the amount of the aforesaid insurance, Yeritsyan said. "It doesn't encourage you to make a deposit or not, it's just that, since we have a law that the deposit is the most liquid asset, if you buy the share, you 'marry' it; if it's bad tomorrow, the price will go down, you can have zero price. The same goes for bonds, whereas there is no such thing for a deposit. We have enshrined in law that a citizen can take his deposit in full whenever he wants; that's already a risk that you need to ensure."
He added that the Central Bank supports the proposed bill.
To note, Mikayel Melkumyan, a member of the opposition Prosperous Armenia faction in the National Assembly and an economist by profession, tabled the aforementioned bill Tuesday, which proposes that the threshold for compensation for bank deposits should be raised in the country.
