Deposit insurance
Deposit insurance ( rare credit fuse) is the name given to the statutory and voluntary measures to protect investments (bank deposits ) of customers at banks in case of insolvency.
- 4.1 Austria
- 4.2 Switzerland
- 4.3 Germany
- 4.4 European Union 4.4.1 EC Directive
- 4.4.2 Additional protection in the EU Member States
Background
Like any investment are also bank deposits with a counterparty risk connected, which is the risk that the bank can not repay the deposit. The instruments of deposit insurance may reduce risks, but can not completely prevent it. The risk exposure to a guarantee of deposits in case of need corresponds to the height of the default risk of the guarantor.
History of deposit insurance
The history of banking is closely connected with the history of banking crises and thus the loss of investors' funds. Protection promised to the investor, only the choice of a bank with a good reputation and a trusted banker.
The first support funds emerged in the field of cooperative banks. 1937, the " Credit Cooperative Guarantee Fund " of the German Cooperative Association was founded. In 1966, the first nationwide safety device of the private banks was founded. Deposits at savings banks were protected by the guarantees.
With the spectacular bankruptcy of the Herstatt Bank in 1974, the security systems of the banks were fully extended. A legal obligation to accede to these facilities, however, did not exist.
Since 1986 was one of the EU Commission Recommendation on a statutory obligation on banks to participate in security systems, which was replaced by a binding directive in 1997. The implementation of this policy has led to the current legal situation described below.
Levels of deposit insurance
Measures for deposit insurance to be taken at different levels:
- Capital requirements,
- Mutual responsibility within banking groups,
- Legal deposit insurance ( in Germany: Deposit Guarantee and Investor Compensation Act ),
- Voluntary deposit guarantees by deposit insurance fund (so-called " fire brigade Fund").
Capital requirements
The elementary safeguard the deposits of customers is to avoid the insolvency of the bank. These serve a number of provisions of the Banking Act, in particular the capital requirements ( Solvency ). By these rules is to ensure that in case of problems the bank sufficient assets is still available to pay off the deposits of customers.
Despite these provisions insolvency of banks can not be excluded. Then the next stage attacks:
Liability in the banking group
Often banks are part of corporations or banks in which formal (ie legally binding ) or informal (ie, voluntary ) are also reciprocal liability regimes.
Legally binding liability rules often exist between parent and subsidiary companies ( letter of comfort ). In the group of savings banks or within the group of cooperative banks is the so-called institutional security. Rights- are not only the deposits, but the existence of the Institute, with the result that bonds of cooperative and savings banks are fully secured.
Legal deposit insurance
Have provisions regarding the deposit insurance in all developed countries. (: 394L0019 / CELEX 31994L0019 Nr) and 97/9/EC ( CELEX No: 397L0009 / 31997L0009 ) In the EU, the minimum requirements by the EC Directives 94/19/EC are prescribed. These are implemented in Germany by the Deposit Guarantee and Investor Compensation Act. Since December 2010 100 % of deposits up to € 100,000 per person are protected (for joint accounts, so 100 % of 2x € 100,000 ) and an additional 90 % of the liabilities arising from securities transactions up to a value of 20,000 € (§ 4 EAEC ). In Germany, however, banks also operate businesses that are not subject to the German statutory deposit insurance. These are banks headquartered abroad that operate in Germany not own German society, but only establishments.
The governments of Ireland, Greece and Germany have announced in September and October 2008 to guarantee unlimited for the deposits of account holders in the wake of global financial turmoil. This was for certain types of deposits in certain banks until June 2011.
In Germany it is a political statement of the government, a legal implementation was only planned. After a subsequent decision on the level of EU finance ministers but are guaranteed legally enforceable since 30 June 2009 to € 50,000. The previous loss participation of depositors amounting to 10 % of their deposits thus falls away. From 31 December 2010, there are even 100,000 €, which are then hedged 100% legit. By guaranteeing the risk is to be reduced so that there is a bank run. Britain raises the maximum amount of 35,000 to £ 50,000 (deposits ( bank balances ): £ 85,000 ). In Sweden, the legal deposit insurance was increased in January 2011, after the example of the EU to € 100,000 - the same time the country is planning to include branches of foreign banks, if the deposit insurance in the home country of these banks should be designed not appropriate.
Voluntary Bank Deposit Guarantee
About this minimum statutory requirements provide banks in many countries to further backups. In Germany these are the Deposit Protection Fund of the respective banking associations that go beyond the legal requirements, protect the deposits of individual customers far. The voluntary deposit insurance takes into account the basic amount of the statutory deposit insurance. Fails to make the legal deposit insurance, this amount is not replaced by the Bank Deposit Guarantee. Even subsidiaries of foreign banks in Germany mostly join the German deposit protection.
State guarantee
This is a deposit insurance that goes into its protective effect on the deposit-guarantee schemes of the banks. It was discussed in Germany at the financial crisis of 2008, but not implemented in the form of a law. But since 5 October 2008 shall apply in Germany a guarantee of the Federal Government as a "political promises." Literally Angela Merkel said on that day: " We say to savers and depositors that their deposits are safe. This too is a the federal government. "
New deposit protection law
On 1 July 2009, the German deposit guarantee of € 20,000 was raised to € 50,000. As of December 31, 2010, the amount increased to € 100,000. The Act also the deadline for payments is limited to a maximum of 30 days and abolished the loss sharing for depositors in the amount of 10%.
Legal deposit insurance in an international comparison
Austria
The deposit insurance in Austria is carried out by five security devices, each bank headquartered in Austria must belong to one of these sectoral institutions. These are:
- Sector banks & bankers: Bank Deposit Guarantee & bankers, the Stock Exchange Act. 11, 1010 Vienna
- Raiffeisen sector: eGen Austrian Raiffeisen deposit guarantee, Am Stadtpark 9, 1030 Vienna
- Savings banks: savings banks liability AG, Grimmelshauseng. 1, 1030 Vienna
- Volksbank sector: Schulze- Delitzsch liability cooperative Löwelstr. 14, 1013 Vienna
- Mortgage banking sector: Hypo - liability mbH, Brucknerstr. 8, 1043 Vienna.
Since 1 January 2010, the deposit insurance in Austria is € 100,000.
Become active, the Bank Deposit Guarantee & bankers already in insolvencies of BWI in 1995, Discount Bank and Bank of Rieger in 1998, as well as the Trigon Bank in 2001.
For these four cases, the deposit insurance had to pay a total of € 140 million.
On 8 October 2008 declared Chancellor Alfred Gusenbauer and Molterer that the unlimited deposit insurance in accordance with the German legislation was adopted in the Council of Ministers, after the EU finance ministers agreed on an EU-wide increase in the deposit insurance of 20,000 € to 50,000 € had. This deposit guarantee applied retroactively from 1 October. As of December 31, 2009, this unlimited deposit insurance ran out; since 1 January 2010 deposits of natural persons are guaranteed for up to a maximum of € 100,000; for partnerships and small corporations of up to € 50,000.
Whether an organization active in Austria Privat-Bank, the Bank Deposit Guarantee joined & bankers, you can find out on the website of the Deposit Guarantee Austria.
The five Austrian deposit guarantees are also a member of the European Association of Deposit Insurers, based in Brussels ( European Forum of Deposit Insurers ( EFDI ) )
Switzerland
In Switzerland 2008 deposits to 100,000 Swiss francs (approx. € 80,000 ) per investor and bank are protected since December. The total number of depositors compensation is limited to 6 billion Swiss francs. Of the 24 cantonal banks have 21 (February 2011) the full state guarantee ( state = Canton).
Germany
The Deposit Protection in Germany consists of two pillars:
Legal Deposit insurance: controlled by the Deposit Guarantee and Investor Compensation Act; Minimum protection under the provisions of the EU
- Compensation Scheme of German Banks GmbH ( EdB )
- Compensation scheme of the Federal Association of Public Banks GmbH
Voluntary deposit insurance systems: protection beyond the statutory minimum, also
- Deposit Protection Fund of the Association of German Banks
- Deposit Protection Fund of the Association of German Public Sector Banks eV
Two banking groups have their own systems to protect member companies, so-called composite Internal security systems:
- Safety device of the Federation of People's Cooperative Banks
- Liability of the Savings Banks Finance Group
These two systems are recognized by law as equivalent to the statutory deposit insurance, both banking groups are therefore excluded from the deposit insurance obligation.
European Union
EC Directive
According to the Directive 2009/14/EC ( CELEX No: 32009L0014 ) is of the EU Member States by 30 June 2009 to increase the minimum to € 50,000 ( € 100 000 from 31 December 2010), the shortening of the deadline for the authorities to determination of insolvency to five working days and for the payment to 20 working days to implement. The EU Member States can set better conditions in their national legislation.
Additional protection in the EU Member States
The individual European states have the EC Directive implemented differently. For branches of banks in other countries, the following limits of the country in which the headquarters are.
Regulations:
In the UK is responsible for the security of customer deposits, the Financial Services Compensations Scheme ( FSCS ). Until 1 October 2007, the maximum amount was £ 31,700 (100 % of the first £ 2,000 and 90 % of another 33,000 pounds). From 1 October 2007 to October 6, 2008 was a provision of 100% up to a maximum of 35,000 pounds. Since October 7, 2008 are 100 % for the first £ 50,000 or € 50,000 per person and businesses. Since December 31, 2010, a new upper limit according to the current EU directives in the amount of 85,000 pounds (about 100,000 € ) applies. All companies subject to UK Banking Financial Services Authority ( FSA) must pay contributions to finance the FSCS.
World
There are often comparable regulations and outside the European Union. The exact conditions are different depending on the national legal system.
In the U.S., investors are protected up to $ 100,000 in 1933 due to the Glass- Steagall Act. Guarantor shall be the Federal Deposit Insurance Corporation ( FDIC ). In the context of the financial crisis from 2007 was the deposit insurance - has been expanded to up to $ 250,000 - limited to 31 December 2009. As part of the Dodd- Frank Wall Street Reform and Consumer Protection Act, the deposit insurance was permanently increased to $ 250,000.
In Canada, issued by commercial banks and 1942 bank notes, which were not legal tender, since 1890, guaranteed by a fund in which the interest rate banks had to deposit one-twentieth of its authorized amount.