Bermuda is developing a deposit insurance scheme to protect consumers holding money in banks and deposit companies.

The move was announced in Friday's Throne Speech, which lays the out Government's forthcoming legislative programme.

It also outlined plans for financial regulator the Bermuda Monetary Authority (BMA) to be given enhanced powers to intervene with troubled banks.

The speech, which was delivered by Governor Sir Richard Gozney at the reconvening of Parliament on Friday, outlined plans to boost Government's legislative powers in the face of a global economic crisis and the impact it has had on Bermuda.

The BMA said it was still working on the details of the proposals for the deposit insurance scheme and enhancing its intervention powers regarding banks.

A spokeswoman for the Authority said there would be public consultation on these initiatives next year, while it had already published a consultation paper, the details of which are available on its website.

She added that the dates of the proposed consultation and implementation plans for the initiatives would be published in the BMA's business plan in January 2010.

In the US, the Federal Deposit Insurance Company (FDIC) provides state-backed insurance for retail depositors up to a certain level. Bermuda has no such provision.

After the financial crisis began last year, the BMA moved to protect depositors by carrying out stress tests on financial institutions and ensuring that all had a sufficient "capital buffer" to withstand a severe economic downturn.

As a result of the enhanced requirements, both Butterfield Bank and Capital G Bank raised extra capital.

The Throne Speech also mentioned plans to modernise legislation governing credit unions' operation.

The Governor announced that amendments to the Banks and Deposit Companies Act would be tabled to strengthen the BMA's powers of intervention in the case of troubled banks in line with the International Monetary Fund's recommendations.