The Deposit Guarantee and Resolution of Credit and Other Institutions Scheme
The Deposit Guarantee Scheme was first established in 2000 and operates as a separate legal entity since then.
The Scheme consists of three funds, the Deposit Guarantee Fund for Banks, the Deposit Guarantee Fund for Cooperative Credit Institutions and the Resolution Fund of Credit and Other Institutions. For this purpose, a Committee was established, consisting of representatives from the Ministry of Finance and the Central Bank of Cyprus.
The objective of the Scheme is, on the one hand, the protection of depositors of banks and their reimbursement in the form of compensation in case a covered institution is unable to repay the deposits of its customers, and on the other hand the funding of the implementation of resolution measures.
The maximum amount of compensation is € 100,000 per depositor including accrued interest, or the equivalent amount in other currency. This amount applies to the aggregate of a depositor’s deposits within the same credit institution. When calculating the amount of compensation payable to a depositor, any loans or other credit facilities granted by the credit institution to the depositor are set off against the deposits.
As of 9 September 2013, the Cooperative Central Bank and all Cooperative Credit Institutions participate in a different Fund, but still under the auspices of the Deposit Guarantee Scheme. The coverage is the same, i.e. up to €100.000 per depositor per credit institution.