SENEGAL Law and Practice Contributed by: Franck Olivier Allessie, SCP Houda & Associés
Depositor Protection and Compensation In the event of an institution’s failure, the FGD compensates depositors up to the set limit, in accordance with the conditions set out in the regulations. Banks are also required to inform their customers about the cover offered by the FGD. These FGD requirements aim to protect deposi - tors and ensure the resilience of the WAEMU banking sector. They impose proactive risk management and transparency obligations on institutions, thereby strengthening customer confidence and the overall financial stability of the Union. 7. Prudential Regime 7.1 Capital, Liquidity and Related Risk Control Requirements Senegal is no exception to other countries with respect to bank secrecy, to which licensed credit institutions in Senegal are bound. Hence, bank secrecy requirements are regulated in Senegal, and the provisions are mainly provided for in the Law of 2008. As such, the persons in charge of the manage - ment, administration, control or operation of credit institutions are bound by bank secrecy. Such persons are, more precisely, prohibited from disclosing any confidential information of which they have knowledge in the course of their activity, in order to conduct directly or indirectly operations for their own account or to benefit others (Article 30, Law of 2008). That being said, bank secrecy is not enforceable against the Banking Commission, the Central Bank or a judicial authority acting in the context of criminal proceedings (Article 53, Law of 2008).
2008 Banking Act and by specific WAEMU deci - sions, in particular Decision No 088-03-2014 of 21 March 2014, the Articles of Association of the Depositors’ Guarantee Fund (FGD), and Decision No 009 of 30 June 2017/CM/UEMOA. These texts define the membership, financing and compensation arrangements for depositors in the event of bank failure. Creation and Operation of the FGD (Decision No 088-03-2014) This Decision establishes the FGD, responsible for protecting savers in the event of the failure of a banking institution, thereby strengthening financial stability and confidence in the WAMU banking system. The FGD’s mission is to compensate depositors while contributing to the stability of the banking sector. Compulsory Membership and Contributions All credit institutions authorised in the WAMU are required to join the FGD and to contribute finan - cially to the FGD through periodic contributions, defined according to their size, their risk profile and the rules established by the FGD. Contribution Rate and Compensation Limit (Decision No 009-2017) Decision No 009-2017 sets the annual contribu - tion rate for members to feed the FGD, ensuring that the fund has sufficient resources to cover deposits in the event of a banking crisis. It also defines the compensation ceiling per depositor in the event of default, guaranteeing the protection of deposits up to a certain limit in order to cover mainly small savers.
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