Kazakhstan Deposit Insurance Fund

The Kazakhstan Deposit Insurance Fund (KDIF) was established on November 15, 1999, to maintain financial stability in the country and protect the rights and legitimate interests of depositors of second-tier banks. The Fund is a non-profit organization. Its sole shareholder is the National Bank of the Republic of Kazakhstan.

Main Tasks of the KDIF:

• participation in ensuring the stability of the financial system;
• protection of the rights and legitimate interests of depositors in the event of revocation of a member bank’s license to conduct all banking operations.

Main Functions of the KDIF:

• paying reimbursement to depositors in the event of revocation of a member bank’s license to conduct all banking operations;
• participating in the operation for the simultaneous transfer of assets and liabilities of a bank to another bank (other banks) in cases provided for by law;
• forming a special reserve;
• investing assets;
• maintaining a register of member banks of the mandatory deposit guarantee system;
• establishing requirements for agent banks;
• approving a preliminary list of agent banks for making reimbursement payouts;
• participating in the temporary administration appointed during the conservation period of a member bank of the mandatory deposit guarantee system;
• participating in the temporary administration appointed during the period of revocation of a bank’s license to conduct all banking operations;
• participating in the liquidation commission of a forcibly liquidated member bank (a branch of a non-resident bank of the Republic of Kazakhstan forcibly terminating its activities) until the liquidation commission repays the debt to the KDIF for the amount of guarantee reimbursement paid (being paid) by it;
• participating in the creditors’ committee of a forcibly liquidated member bank (a branch of a non-resident bank of the Republic of Kazakhstan forcibly terminating its activities) until the liquidation commission repays the debt to the KDIF for the amount of guarantee reimbursement paid (being paid) by it.

Deposit Guarantee System Members in Kazakhstan

To date, all Kazakhstani second-tier banks participate in the Deposit Guarantee System (DGS), with the exception of Islamic banks. A bank becomes a DGS member from the day the Fund enters information into the register of DGS participating banks; accordingly, funds of depositors—natural persons and individual entrepreneurs—in national and foreign currencies placed in bank accounts become an object of the KDIF guarantee.

The objects of the guarantee are funds of natural persons and individual entrepreneurs in national and foreign currencies located in bank accounts in member banks of in the mandatory deposit guarantee system and certified by bank account and (or) deposit agreements, including in branches of foreign banks opened in the territory of Kazakhstan.

The KDIF Guarantee Covers:

• deposits, including demand and conditional deposits;
• remuneration (interest) on deposits accrued as of the date of revocation of the member bank’s license to conduct all banking operations;
• money in current accounts and on payment cards.

In the event of revocation of a member bank’s license to conduct all banking operations, the owner of a bank account, card, and (or) deposit has the right to receive guarantee reimbursement thereon in the national currency within the coverage limit.

The Coverage Limits Are:

• 20 million tenge for savings deposits in national currency;
• 10 million tenge for cards, accounts, and other deposits in national currency;

• 5 million tenge for cards, accounts, and deposits in foreign currency (in equivalent at the exchange rate established on the date of revocation of the member bank’s license).

If several deposits differing in type and currency are placed in one member bank, the aggregate balance of the amount for all deposits is guaranteed, but not exceeding the coverage limit—20 million tenge, taking into account the limits for each type of deposit.