Deposit Guarantee Schemes Directive (DGSD)

EBA Publishes Opinion on Eligibility of Deposits, Coverage Level and Co-Operation Between Deposit Guarantee Schemes Under the DGSD

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On August 8, the European Banking Authority (EBA) published an opinion (EBA-Op-2019-10) on the eligibility of deposits, coverage level and co-operation between deposit guarantee schemes (DGS) under the Deposit Guarantee Schemes Directive (DGSD) (2014/49/EU).

The opinion outlines a number of general and specific proposals for the European Commission to consider when preparing its mandated report on the progress made towards implementing the DGSD and if the Commission prepares a proposal for a revised DGSD.

The opinion sets out the EBA’s proposals on a range of topics, including:

  • Home-host co-operation, and co-operation agreements between DGS
  • DGS’ co-operation with various stakeholders
  • Transfer of contributions
  • Coverage level
  • Current list of exclusions from eligibility and current provisions on eligibility

It includes a report that provides a detailed analysis of each topic, including the background, methodology, data sources, options to address the issues identified and conclusions.

EBA Issues Guidelines Under Recast Deposit Guarantee Schemes Directive (DGSD)

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On May 28, 2015, the EBA published its final guidelines (EBA/GL/2015/10) on methods for calculating contributions under the recast DGSD.

Article 13 of the recast DGSD requires contributions to deposit guarantee schemes (DGSs) from their members to be risk-based. The guidelines specify the objective and principles for DGS contributions and provide guidance on specific elements that should be taken into account in developing and assessing the methods for calculating risk-based contributions.

The EBA also published its final guidelines (EBA/GL/2015/09) on payment commitments under the DGSD. Article 10(3) of the recast DGSD states that the available financial means of a deposit guarantee schemes (DGSs) may include “payment commitments”. These are defined as payment commitments of a credit institution towards a DGS that are fully collateralized, providing that the collateral consists of low risk assets and is unencumbered by any third-party rights and is at the disposal of the DGS.

The guidelines provide guidance on the legal instruments that should be entered into by DGSs and credit institutions, providing for the terms and conditions for the inclusion of payment commitments within the available financial means of the DGS. These guidelines also provide criteria on the eligibility and management of the collateral.

The EBA expects competent authorities and designated authorities to implement both sets of guidelines by December 31, 2015.