Australian Government's 2008 Deposit and Wholesale Funding Guarantees

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On 31 March 2010, the Guarantee Scheme for Large Deposits and Wholesale Funding (Guarantee Scheme) closed to new guaranteed liabilities.  The Financial Claims Scheme will remain in effect and is not affected by the closure of the Guarantee Scheme.

The Government’s deposit and wholesale funding guarantees were announced by the Prime Minister on 12 October 2008. On 24 October 2008, the Treasurer announced further design and operational parameters for the Government's deposit and wholesale funding guarantees. 

On 28 November 2008, the Treasurer announced the commencement of the Guarantee Scheme.  On 7 February 2010, the Treasurer announced the Government’s intent to close the Guarantee Scheme on 31 March 2010.  

Deposits up to and including $1 million per depositor, per authorised deposit-taking institution will continue to be covered for free by the Financial Claims Scheme.  The $1 million cap will be reviewed in 2011.

Details on the Guarantee Scheme can be accessed from the Government Guarantee Scheme for Large Deposits and Wholesale Funding website.  Details on the Financial Claims Scheme can be accessed from the Australian Prudential Regulation Authority website.

The legislation covering this issue is:

• Financial System Legislation Amendment (Financial Claims Scheme and Other Measures) Act 2008
• Banking Act 1959 - Declaration of Covered Financial Products
• Banking Amendment Regulations 2008 (No. 1)

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