Deposit insurance premiums

The Deposit Insurance Fund (DIF) consists of capital contributions and net income accumulated mainly from initial and on-going premium income. All members banks are obliged to pay deposit insurance premiums to DIFK which represent the main funding source of the Deposit Insurance Fund.

There are two types of regular deposit insurance premiums: initial premiums which have to be paid by newly licensed banks (0.3% of initial capital) upon commencement of their membership in DIFK and on-going premium which all member institutions have to pay regularly on a quarterly basis.

DIFK applies differential premiums among institutions, differing levels of risk based on the CBK overall assessment ratings that are assigned to banks. Member banks pay insurance premiums proportionate to their relative risk that pose to the Deposit Insurance Fund (DIF) i.e., higher premium, for higher risk profile of member.

The member banks with highest overall assessment ratings (representing lower risk to DIFK) pay 0.75% per annum of the total amount of insured deposits, whereas banks with lower overall assessment ratings (representing higher risk to DIFK), pay 1.5% per annum on the total amount of insured deposits.

In line with the Law on Deposit Insurance, DIFK has the right to direct debit the amount of ongoing premiums from member bank’s account with CBK.

DIFK will direct debit due amount of ongoing premiums from the member banks’s account at the CBK by the applicable dates. The premium payment is treated as a tax-deductible expense by the banks.

Ongoing premium collection schedule

The premium payment is treated as a tax-deductible expense by the banks.

Collections of ongoing quarterly premiums