The Andorra Deposit Guarantee Scheme (DGS) Administration is a financial safety net mechanism designed to protect depositors in the event of a bank failure within the Principality of Andorra. The primary purpose of this scheme is to maintain public confidence in the banking system by ensuring that depositors’ funds are secured up to a certain limit. Deposit insurance is essential as it reduces the risk of bank runs, where a large number of customers withdraw their deposits simultaneously due to concerns about a bank’s solvency. By providing a guarantee on deposits, the DGS Administration helps maintain financial stability and prevents negative spillover effects on the broader economy.
The working of the deposit guarantee scheme in Andorra is based on the principle of reimbursement. In case a bank is unable to meet its obligations to depositors, the DGS Administration steps in and compensates depositors up to a predefined limit. As of September 2021, the coverage limit was set at €100,000 per depositor per bank. This amount can be periodically reviewed and updated by the authorities. The DGS Administration is funded by contributions from member banks, which are required to pay into the scheme based on their level of risk and the amount of deposits they hold.
The organizational structure of the DGS Administration in Andorra is designed to ensure its operational efficiency and independence. The administration is overseen by a governing board, which is responsible for setting policies and guidelines and making important decisions. The board is composed of representatives from various stakeholders, including the government, central bank, and the banking sector. The day-to-day operations of the DGS Administration are managed by a dedicated staff, who ensure that the scheme is adequately funded and that compensation processes are executed effectively in case of a bank failure.
For further information and inquiries related to the Andorra Deposit Guarantee Scheme Administration, you can use the contact information provided below:
Autoritat Financera Andorrana
(Andorra Deposit Guarantee Scheme Administration)
C/ Bonaventura Armengol, 10 Ed. Montclar, bloc 2, 4a planta
AD500 Andorra la Vella Principat d’Andorra
Phone: (+376) 80 88 98
Email: [email protected]
Please note that the contact information provided above may have changed since the knowledge cutoff date in September 2021. It is advisable to consult the official website or other reliable sources for the most up-to-date information.