Jersey States extend bank deposit protection scheme

Changes are being made to a Jersey finance scheme, which provides compensation to people if a bank collapses.

Amendments to the Jersey Bank Depositors Compensation Scheme will soon come into action.

Finance institutes in the island will have to pay an annual charge to fund the scheme.

A compensation scheme was first introduced in 2009 and the States say the changes will protect it.

The changes are being introduced by the Economic Development Department to bring the scheme into line with developing international standards.

Compensation from the scheme is capped at £50,000 per depositor per banking group.

The new changes include the introduction of an annual fee the banks will have to pay to cover the costs of the scheme and a new duty on the liquidator of a failed bank meaning they have to pay depositors as soon as possible.

The amendments will be debated by the States on 25 September 2012.