1. Deposit insurance and financial stability schemes AEG New York, April 2012 nadim.ahmad@oecd.org

2. Background Various schemes introduced by governments in wake of recent financial crisis to provide financial stability and to protect depositors. Raise a number of questions concerning treatment in the NA 2

3. Stability fee and deposit insurance schemes Compulsory payments levied by government –May or may not be hypothecated to a special fund –Which may or may not be hypothecated only to support the institutions that pay in to the fund. 3

4. Proposals Paid into a consolidated fund (not hypothecated) = tax –Or should there be a caveat in cases where the payments into the fund are broadly equal to expected payouts? Paid into hypothecated fund, –with sums paid in exceeding expected payouts = tax –with sums paid in broadly equalling expected payouts = (insurance) service ? Or should these always be treated as taxes for simplicity? 4

5. Deposit protection scheme Key issue: treatment of priority claims and acquisition of assets by government to redistribute to depositors as part of government’s deposits guarantee 5

6. Proposal Any positive difference between assets acquired by government and redistributed to depositors = service payment Any additional levy imposed by government to make up for any shortfall = tax. 6

7. AEG Asked to consider proposals And whether any additional guidance should be developed for GFS manual? 7