Recommended and organised by the World Bank, a 12-strong delegation of the Mongolian financial governance paid a visit to Hungary. The objective of the delegation was to gather relevant models and operating experience needed for passing a law to handle the Mongolian bank crisis and to ensure deposit insurance, and for establishing institutional frameworks.
Due to this complex set of subjects, the Mongolian delegation included the first deputy governor of the National Bank of Mongolia, experts from the ministries of justice and finance, as well as from the supervisory authority, in combination with high-ranking politicians involved in the subject of financial stability and the members of the Mongolian parliament.
In Mongolia, currently a 100 percent state guarantee applies to bank deposits. The country intends to create its own deposit insurance law and an institution established on the foundations of market economy still in the current year, as well as an efficient institutional framework system suited to manage any potential bank crises in the future.
“Experience with Hungarian deposit insurance – although its only function is indemnification now – represents a model for a number of countries on their way to a modern and efficient insurance deposit system. The NDIF is among the few institutions in the world that holds actual and positive experience with accelerated, 20-working-day indemnification, and accordingly functions as an important pillar of public trust in the banking system and of reinforcing financial stability. Beyond the lessons learnt from the most recent case of compensation, it is the history of Hungarian deposit insurance that makes it an outstanding institution through the numerous exemplary solutions of managing bank crises and through its unique tools”, said World Bank advisor Djurdjica Ognjenovic.