On May 17-19 an international conference on deposit insurance (An Early Feedback System – Implementation Ways and Methods) was held in Almaty (Kazakhstan) where the representatives of the National Bank of Georgia were invited among 100 participants from various countries.Per Mamuka Machaidze, acting head of the Banking Supervision and Regulation Department of the National Bank of Georgia, the main principles of financial safety, effective management and the rights and duties of the members of the system were discussed at the conference. Special emphasis was laid upon the activities of the deposit insurance companies. When banks fail, the minimization of expenditures is am important challenge of deposit insurers and other members of the financial safety system. It is possible to resolve this question by the mutual efforts of the members of the financial safety system and by effective use of ‘early warning system’ and bank liquidation procedures.The Almaty conference was organized by: Kazakh Deposit Guaranty Fund, Swiss State Secretariat in Economic Issues, International Association of Deposit Insurance, EBRD and USAID. The main topic of the conference – deposit insurance, is timely for Georgia as the Bank is now working on the draft law on the deposit insurance system. Therefore, the experience of other countries and financial institutions is worth of attention, Mr. Machaidze said.Giorgi Laliashvili, head of Macroeconomic Research and Monetary Policy Department, said that the Ukrainian delegation proposed their Georgian colleagues to introduce their deposit insurance system and legislative framework. The deposit insurance system has been in operation in Ukraine since 1999. Ukraine is a member of the international association of deposit insurance, which was founded in May of 2002 and unites about 40 countries. The Bank is the initiator of the establishment of deposit insurance system. On May 6, 2005, at the Decree of President of the National Bank of Georgia, the working group was established to develop the draft law on deposit insurance. This system is one of the important instruments to increase the public confidence in the banking sector. If a bank fails, a depositor will receive the amount determined under the deposit insurance scheme. This in turn will facilitate the growth of the deposit base and make banks more active in their financial mediation role. The TA is provided by KFW.