At the end of 2021, 17 out of 36 national bank deposit guarantee schemes (DGS) in the European Economic Area had reached the EU-wide target of 0.8% of covered deposits by July 2024, according to data published by the European Banking Authority (EBA) on Thursday 4 August.
The EBA notes that the financial means of 34 DGS increased by more than 19% between 2020 and 2021. In addition, eligible savings of individuals and companies increased by 5.6% in 2021 and 8.6% in 2020, both years marked by the Covid-19 pandemic.
The data provided by the European authority distinguishes, for the first time, between direct contributions from financial institutions that are members of a national scheme (‘qualified available financial means’) and borrowed funds - all of which are among the financial means available to the DGSs. Only direct contributions are taken into account in the calculation of the 0.8% ratio of covered deposits.
In June, the Eurogroup failed to finalise a work programme to complete the banking union in the euro area (see EUROPE 12974/10). Nevertheless, it decided to move forward on one of the workstreams, namely the management of a crisis arising from a bank failure. In this area, legislative reform will aim to achieve greater convergence between national deposit guarantee schemes, with the introduction of a harmonised ‘least-cost test’ to govern the use of available funds.
In the EU, bank deposits of up to €100,000 are protected in all circumstances.
See EBA data: https://aeur.eu/f/2SL (Original version in French by Mathieu Bion)