The Law concerning the conditions of return of term deposits entered into force

<font face=”georgia” size=”3″>On June, 3 President of Ukraine signed the Law “On Amendments to Certain Legislative Acts of Ukraine (concerning the conditions of return of term deposits)”</font>

<font face=”georgia” size=”3″>Provisions of this Law, which has been the subject of discussions for the long time, but were introduced as a means of improving the stability of the banking system, established that citizens who made a deposit to the bank on conditions of term deposit, have the right to return it on demand at any time before the expiry only in case if such right was envisaged by the contract of bank deposit.</font>

<font face=”georgia” size=”3″>Be recalled that under the provisions of the previous version of Art. 1060 of the Civil Code of Ukraine, depositors have the right to withdraw their funds on demand regardless of the type of deposit (fixed-term or on demand) and the terms of the contract that deprive depositors (individuals) this right were acknowledged invalid.</font>

<font face=”georgia” size=”3″>These rules were criticized by the banking sector, in particular, because of the current financial and economic situation, when citizens began to withdraw their money from banks, which did not allow banks to forecast its business activities and use the borrowed funds.</font>

<font face=”georgia” size=”3″>At present time, as before, except for of term deposits depositors can use the current deposits (on demand), which, of course, have lower interest rates, but the bank is required to return or transfer funds at any time in such deposits.</font>