What are deposit insurance objectives?
The main objective of deposit protection scheme is to ensure that citizens and companies will not loose their savings and deposits held with bank if their bank becomes insolvent. Thereby deposit insurance contributes to confidence in the banking system, enhancing more propitious bank services, as well.
Significant goal of the deposit protection system in Montenegro, like in all other countries, is a contribution to the overall financial stability. Banks are faced with increased risk, since working with borrowed money and having liabilities to a number of depositors, and a bankruptcy of a single bank could initiate a cycle of instability hitting entire financial system.