BoA to cooperate with US Deposit Insurance Corporation

TIRANA, April 30 – Albania’s central bank has signed a memorandum of understanding with the United States Federal Deposit Insurance Corporation (FDIC) aimed at increasing economic and financial cooperation. Under the deal signed in Washington by Bank of Albania governor Ardian Fullani and FDIC chairman Martin J. Gruenberg, there will be exchange of information on banking services, deposit insurance and the steps that must be taken to ensure Albania’s financial stability, says the Albanian central bank.
The Federal Deposit Insurance Corporation (FDIC) preserves and promotes public confidence in the U.S. financial system by insuring deposits in banks and thrift institutions for at least $250,000, by identifying, monitoring and addressing risks to the deposit insurance funds, and by limiting the effect on the economy and the financial system when a bank or thrift institution fails.
In Albania the function is carried out by the Deposit Insurance Agency established since October 2002 as part of Albanian safety net, its main target is the protection and compensation of individuals deposits in banking system, with final aim at the contribution to strengthen the financial system in Albania.
As elsewhere in the region, Albanian banks witnessed substantial panic deposit withdrawals in the face of spillovers from instability of global financial markets, which were compounded by concerns about the health of the Greek banking system in the fall of 2008. Ample liquidity buffers were utilized to meet deposit withdrawals. To boost confidence, deposit insurance limits were raised fivefold to 2.5 million lek (25,000 US dollars), and deposits started to recover from the second half of 2009.