The Central Bank Board of Directors recently held an early weekly meeting to make significant changes to the guarantee limits for bank deposits. Effective immediately, deposits made in pesos are now covered up to $50 million, while foreign currency deposits are covered up to $100,000. This adjustment was made in response to inflation and represents a 733% increase over the previous sum assured.
Deposit guarantee insurance is a crucial aspect of the banking system that protects depositors from losses in case of bank closure or change of ownership. This insurance is applied per depositor and per entity and covers various types of accounts such as current accounts, demand accounts, savings accounts, fixed term accounts, salary accounts and term investments. The system was established by Law 24,485 and regulated in April 1995 by Decree 540. Sedesa, a company owned by the Central Bank and financial entities, provides this insurance.
Financial institutions contribute to the Deposit Guarantee Fund based on their capital they receive with the aim of having sufficient funds to respond to all risks for depositors. As of March 21, the fund’s balance was $3,344,653,160,951. This insurance ensures that when the stock of deposits grows, so do the funds available to Sedesa. Banks are required to make monthly contributions based on their average daily deposits in pesos and dollars.
The deposit guarantee insurance system is a preventive measure that enables institutions to effectively respond to all potential risks for depositors. It helps maintain confidence and trust in the financial sector which ultimately benefits depositors and financial institutions alike.