4 Introduction

Deposit Insurance Schemes have been implemented in most countries, to safeguard the interest of the depositors in the event of bankruptcy of the depository institution. With the introduction of regulations such as Basel III, the insured portion of a deposit is required to be identified and treated appropriately for liquidity risk purposes. Regulations such as FDIC 370, mandate banks to identify and report the insurance coverage at an account level for various ownership rights and capacities, to ensure that the insurer pays out the amount due to depositors promptly.

OFS Deposit Insurance Calculations for Liquidity Risk Management (OFS DICLRM) covers deposit insurance calculations for the purpose of liquidity coverage ratio and other calculations required for Liquidity Risk Management. The application identifies insurance eligible accounts under a particular deposit insurance scheme, the right and capacity under which these accounts are held and the insurance limit provided by the country specific insurer for each account. It allocates the insurance limit to the account level based on the ownership right and capacity, and identifies the insured and uninsured portion of the account.