25 July 2014
NDIF to start the indemnification of the depositors of
Orgovány és Vidéke Cooperative Savings Bank
The National Deposit Insurance Fund (NDIF) is starting the indemnification of the depositors of Orgovány és Vidéke Cooperative Savings Bank, and will finish the process within 20 working days. The customers of the savings bank can be entitled to the forint equivalent of EUR 100,000 (HUF 30,835,000) per person, depending on whether they are individual or corporate customers.
NDIF is about to start the indemnification of around 30,000 depositors of Orgovány és Vidéke Cooperative Savings Bank, and will finish the process within 20 working days, by 25 August at the latest, after the ruling about the liquidation of the savings bank was published in the Corporate Gazette (Cégközlöny) today. The National Bank of Hungary (NBH) revoked the operating licence of the Orgovány based cooperative savings bank on 4 July, and it also appointed supervisory commissioners who recommended the liquidation of the savings bank following the assessment of its financial standing.
“Depositors do not need to take any action in connection with the indemnification process. NDIF will notify them about the amount they are entitled to and about the process of indemnification by post, based on the data kept by the savings bank. In the case of compensations up to HUF 100,000 the postal delivery person will deliver the amount of indemnification to the depositor’s address. Customers eligible for indemnities exceeding this threshold can withdraw their money or make other arrangements at the post offices or savings bank branches specified in the letter sent to the customers,” Managing Director of NDIF András Fekete-Győr said.
In the case of private individuals NDIF will use three methods of delivery to complete the indemnification process as soon as possible:
· up to HUF 100,000 the postal delivery person will deliver the amount of indemnification to the depositor’s address.
· between HUF 100,000 and HUF 2.5 million the postal delivery person will deliver the depositor a notification which will specify the post office where he/she can receive the amount of indemnification he/she is eligible for.
· over HUF 2.5 million NDIF will send the depositor a letter specifying the cooperative savings bank where the customer can make arrangements regarding the amount of indemnification he/she is eligible for (deposits, transfers or cash withdrawal).
In the case of legal entities, independent of the amounts concerned, NDIF will notify the customers by post and specify the savings bank branch in which they can receive the money they are entitled to. NDIF will post a detailed announcement on its website (www.oba.hu) about the indemnification process. The announcement will also be published in the dailies Magyar Nemzet, Népszabadság and Petőfi Népe, and will be displayed in the branches of Orgovány és Vidéke Cooperative Savings Bank. NDIF’s customer service telephone number (40-918-918) will be operational day and night until the end of the indemnification procedure. Calls will be charged at a discount rate.
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To the editor
Bank deposits placed in credit institutions in the territory of the EU are insured by the national deposit insurance institution of the country of incorporation. Since 1993, all credit institutions (banks, savings cooperatives, credit unions, home savings banks) holding an operating licence in Hungary have been mandated to join NDIF and pay accession and annual fees. The key responsibility of NDIF, which supports the stability of the Hungarian banking system, is to indemnify depositors from its accumulated funds in the case of frozen deposits. See the current rules of deposit insurance on the homepage of NDIF: http://www.oba.hu/en/deposit-insurance/compass-downloadable-file.
In case of the liquidation/dissolution of a credit institution the eligible depositors are indemnified by NDIF within 20 working days, aggregately by private individuals and credit institutions for up to EUR 100,000. The indemnity, which is always paid in HUF, pertains both to the principal and interest amounts of the frozen deposits. Brief information on the process of indemnification is available on the homepage of NDIF (http://www.oba.hu/en/deposit-insurance/payout-process).
Act CCXXXVII of 2013 on Credit Institutions and Financial Enterprises, which regulates the operation of NDIF.
Paying agent bank
NDIF has concluded master agreements with several credit institutions with official seats and extensive branch networks in Hungary to act as paying agents. This means that in case of mass payments the paying agent contributes/paying agents contribute to the process of indemnification through their payment function. Clients can withdraw the amounts reserved for their use in the paying agent bank in cash, place the amounts as deposits or other savings products in the same bank, or may transfer these amounts to a bank account they have opened in a Hungarian credit institution. Clients must definitely visit a branch office of the paying agent.
NDIF consumer protection logo
The banking products insured by NDIF are easy to recognise due to the deposit insurance consumer protection logo the use of which has been mandatory since 1 March 2012. The use of the logo is regularly checked by NDIF during its credit institution audits, and it is also monitored by the Hungarian Financial Supervisory Authority: http://www.oba.hu/en/ndif-members/customer-protection-logo.
NDIF member institutions
As of 31 December 2013, NDIF had 157 member institutions, including 4 home savings banks, 4 credit unions, 34 banks and 115 savings associations.