New safety net in place for bank failures
The Finance Ministry has announced the establishment of the Virgin Islands Deposit Insurance Corporation (VIDIC), saying it is a crucial step towards enhancing financial security for depositors within the territory.
The VIDIC held its inaugural board meeting on January 16, 2024. The government said the VIDIC is designed to be the financial safety net for the territory, offering crucial deposit protection.
In the event of a bank’s failure, VIDIC would help to ensure that residents’ investments are safe.
“It’s a proactive measure to instill confidence and security in our banking system, providing peace of mind to every depositor,” a release from the Finance Ministry said.
In other jurisdictions, deposit insurance schemes only offer financial protection up to a certain amount of cash and they usually cover certain investments. The Finance Ministry did not say whether there will be a cap on the amount of money that will be covered in cases of bank failures.
It is also still left to be determined if all or only some types of investments will be covered.
In the meantime, the Ministry has named the VIDIC board of directors, saying they will play a pivotal role in guiding the strategic direction and success of the organisation.
The board is comprised of Mr Ian S. Smith – Chairman, Mr David Walker – External Director, Mr Kenneth Baker – Director, Mrs Sherri Ortiz-Fahie – Director, and Mr Phillip Fahie – Director.
VIDIC is also tasked with collaborating with financial institutions to uphold and maintain high standards of financial security.
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IT’S ABOUT TIME
Where is it going to get money to payout if there is a claim? No details given?
I thought that this would have been an insurance policy taken up by the banks. When your premier is S!0w W@nde and the government and opposition are the A$$ C!0wn Brigade you just don’t know what you are going to get
So where is all of this magic money going to come from? Clearly taxes and fees on said banks. Usually there is a cap of $50k. Given our small risk pool how much can be reasonably ensured?