JDIC stays on growth path

KINGSTON — The Jamaica Deposit Insurance Corporation (JDIC) continued on a steady growth path during the 2009/2010 fiscal year, with its Deposit Insurance Fund (DIF) achieving $6.6 billion at the close of the period.

This represented a 28 per cent increase, up from $5.1 billion in the previous financial year.

As set out in the JDIC's annual report, which was tabled in Parliament last week, for the 2009 calendar year, the number of insurable deposit accounts grew by 5.4 per cent over the 2008 average. Meanwhile, major potential liability, insured deposits increased by nine per cent, moving up to $2.14 billion, commensurate with the growth in insurable deposits.

The dollar value of insurable deposits also increased by 8.8 per cent to $4.8 billion during the 2009 calendar year, which resulted in the average balance in insurable deposit accounts growing by 5.4 per cent over the 2008 average.

As it relates to legislative framework, the Corporation proposed further amendments to the Deposit Insurance Act to allow the authorities a wider range of measures to deal with failing policyholder institutions.

To this end, a draft Bill was considered in relation to the borrowing of funds for the specific purpose of ensuring that the Corporation has sufficient resources for its resolution and intervention activities in circumstances where the DIF is not sufficient. The Bill has since been gazetted and incorporated into the JDIC Act.

Meanwhile, the Corporation said it, “viewed the period of the global financial crisis as an opportunity to intensify the monitoring of member institutions and further enhance its policyholder assessment capabilities as well as intervention and resolution strategies”.

In this regard, the JDIC revised the framework for admission of members to the Deposit Insurance Scheme (DIS), making provisions for admitting a new subsector – credit unions.

The JDIC says it adopted a flexible approach and remained ready to pay out to depositors in the event of a failure of a licensed deposit-taking institution, by initiating prudent strategies to improve profitability and sustainability.

By ALPHEA SAUNDERS, JIS Reporter