Introduction

This annual report of the State Corporation "Deposit Insurance Agency" (further, ‘the Agency’) was prepared in accordance with Article 24 of the Federal Law On The Insurance of Household Deposits in Banks in the Russian Federation (further, ‘the Deposit Insurance Law’) and approved by the Agency’s Board of Directors on 13 April 2005.

In accordance with Federal law and the Banking Sector Development Strategy, the Agency performs two related and socially significant functions, aimed at creating a multi-faceted system for defending the interest of banks’ creditors. In accordance with the Deposit Insurance Law, the Agency is responsible for maintaining a functioning deposit insurance system. After amendments to the Federal Law On the Insolvency (Bankruptcy) of Credit Organizations came into force on 27 November 2004, the Agency also took on the role of liquidator and official receiver in bankruptcy for failed banks holding household deposits.

In 2004, the Agency’s concrete tasks were first and foremost to lay the organizational, normative and methodological foundations needed to fulfil these legal requirements, including the entry of banks into the deposit insurance system, the creation of the deposit insurance fund as a financial basis for operations, and activities connected with the liquidation of failed credit organizations.

The Agency’s ability to achieve these tasks was in large part made possible by the cooperation of the Russian Government and the Bank of Russia, representatives of both of which sit on the Agency’s Board of Directors, as well as fruitful collaboration between the Agency and bank associations.