ANNOUNCED AS TEMPORARYNo
The government announced on 25 August 2009 that it will extend the Retail Deposit Guarantee Scheme to 31 December 2011 and change some of its terms and conditions. The current scheme ends on 12 October 2010.
The government introduced the Crown retail deposit guarantee scheme on 12 October 2008 in order to support maintenance of public confidence in the New Zealand financial system and in New Zealand financial institutions at a time of international financial market turbulence. TheScheme guarantees all retail deposits of up to 522,700 US dollars with approved financial institutions for two years.
The government has signed agreements with a number of institutions such as banks, finance companies, building societies and credit unions. These agreements are called a Crown Deed of Guarantee. Under the terms of those deeds, the Crown guarantees the institution's payment obligations to that institution's eligible retail deposit holders. This means that if an institution that has signed a deed defaults on its obligations, then the crown will pay the eligible depositors and take over their rights as creditors of the defaulting institution.
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