Text · Amendment list
Amending Directive 2014/49/EU as regards the scope of deposit protection, use of deposit guarantee schemes funds, cross-border cooperation, and transparency
Document ECON-AM-754693 · COM(2023)0228 – C90133/2023 – 2023/115(COD)
- Kind
- Amendment list ECON-AM-754693
- Date
- 6 November 2023
- Committee
- Committee on Economic and Monetary Affairs
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- COM(2023)0228 – C90133/2023 – 2023/115(COD)
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| Text proposed by the Commission | Amendment |
|---|---|
| (1a) The ongoing review of the Union crisis management and deposit insurance framework is intended to pave the way towards the long-due completion of the banking union, including the establishment of a European deposit insurance scheme. A first step in that direction is the establishment of an EU credit line or guarantee provided by a dedicated fund to be established and managed by the Single Resolution Board (SRB) within its available financial means, to depleted, or close to being depleted, national DGSs. Where both the requesting DGS and the EU credit line and guarantee are depleted, other existing DGSs within the Union should step in to provide the depleted DGS with the necessary financial means to perform its functions. |
| Text proposed by the Commission | Amendment |
|---|---|
| (1a) The target levels of the resolution financing arrangements and the DGSs were determined in 2014 to withstand severe adverse shocks to the banking system given the loss absorption capacity of the system at the time. As a result of the reforms undertaken since 2014, the loss absorption capacity of European banks has significantly improved, with the increase of capital and liquidity ratios, the build-up of high MREL buffers, and the halving of the level of non-performing loans. As a result, the same target level of the various funds now enables to withstand a much more severe economic shocks. |
| Text proposed by the Commission | Amendment |
|---|---|
| (1a) At present, the banking union rests on just two of its intended three pillars, namely, the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism (SRM). It therefore remains incomplete, due to the absence of its third pillar, the European deposit insurance scheme (EDIS). The completion of the banking union forms an integral part of economic and monetary union and of financial stability, most notably by mitigating the risks of so-called ‘doom loop’ that arise as a result of the bank-sovereign nexus. |
| Text proposed by the Commission | Amendment |
|---|---|
| (1a) The Banking Union is a fundamental pillar of the Economic and Monetary Union (EMU) and its development has been essential to guaranteeing the stability and resilience of the banking sector, including by way of the Single Supervisory Mechanism and the Single Resolution Mechanism. Unfortunately, the Banking Union is not yet complete, owing to the slow adoption of a European deposit insurance scheme (EDIS). |
| Text proposed by the Commission | Amendment |
|---|---|
| (1a) The Union crisis management framework should ensure at all times that losses are not being socialised and taxpayers’ resources are not employed to aid or rescue credit institutions in difficulty, unless in extraordinary circumstances of a systemic nature or pertaining to very large economic turmoil. |
| Text proposed by the Commission | Amendment |
|---|---|
| (1b) The Union crisis management framework should ensure at all times that losses are not being socialised and taxpayers’ resources are not employed to aid or rescue credit institutions in difficulty, unless in extraordinary circumstances of a systemic nature or pertaining to very large economic turmoil. |
| Text proposed by the Commission | Amendment |
|---|---|
| (3) To support further convergence of DGSs’ practices and assist DGSs in testing their resilience, the European Banking Authority (EBA) should issue guidelines on the performing of stress tests of DGS’ systems. | (3) To support further convergence of DGSs’ practices and assist DGSs in testing their resilience, the European Banking Authority (EBA) should review and, where necessary, update its guidelines on the performing of stress tests of DGS’ systems on a regular basis. |
| Text proposed by the Commission | Amendment |
|---|---|
| (3) To support further convergence of DGSs’ practices and assist DGSs in testing their resilience, the European Banking Authority (EBA) should issue guidelines on the performing of stress tests of DGS’ systems. | (3) To support further convergence of DGSs’ practices and assist DGSs in testing their resilience, the European Banking Authority (EBA) should review and, if necessary, update its guidelines on the performing of stress tests of DGS’ systems in regular intervals. |
| Text proposed by the Commission | Amendment |
|---|---|
| (4) Pursuant to Article 5(1), point (d), of Directive 2014/49/EU, deposits of certain financial institutions, including investment firms are excluded from coverage by the DGS. However, the funds that those financial institutions receive from their clients and that they deposit in a credit institution on behalf of their clients, in the exercise of the services they offer, should be protected subject to certain conditions. | (4) Pursuant to Article 5(1), point (d), of Directive 2014/49/EU, deposits of certain financial institutions, including investment firms are excluded from coverage by the DGS. However, the funds that those financial institutions receive from their clients and that they deposit in a credit institution on behalf of their clients, in the course of their business in scope of Directive (EU) 2015/2366, Directive 2009/110/EC and Commission Delegated Directive (EU) 2017/593, should be protected subject to certain conditions. |
The references to ‘financial institutions’ and the ‘deposit in the course of their business’ is too broad and should be limited to the use cases that the EBA and the Commission have examined in advance. Otherwise, this can lead to inconsistencies and significant administrative consequences that were neither intended nor evaluated in advance.
| Text proposed by the Commission | Amendment |
|---|---|
| (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities have been excluded from coverage. However, most public authorities (which in some Member States include schools and hospitals) cannot be considered to be professional investors. It is therefore necessary to ensure that deposits of all non-professional investors, including public authorities, can benefit from the protection offered by a DGS. | (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities shall remain excluded from coverage. |
The inclusion of public authorities does not further the objective of deposit insurance. These entities are not in need of protection, nor does their inclusion have a significant impact on maintaining financial stability. Depositor groups should not be included in the scope of protection just for simplicity’s sake.
| Text proposed by the Commission | Amendment |
|---|---|
| (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities have been excluded from coverage. However, most public authorities (which in some Member States include schools and hospitals) cannot be considered to be professional investors. It is therefore necessary to ensure that deposits of all non-professional investors, including public authorities, can benefit from the protection offered by a DGS. | (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities shall remain excluded from coverage. |
| Text proposed by the Commission | Amendment |
|---|---|
| (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities have been excluded from coverage. However, most public authorities (which in some Member States include schools and hospitals) cannot be considered to be professional investors. It is therefore necessary to ensure that deposits of all non-professional investors, including public authorities, can benefit from the protection offered by a DGS. | (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities have been excluded from coverage. However, most public authorities (which in some Member States include schools and hospitals) cannot be considered to be professional investors. Therefore, in order to facilitate a level playing in the single market it is necessary to ensure that deposits of all non-professional investors, including public authorities, can benefit from the protection offered by a DGS. |
| Text proposed by the Commission | Amendment |
|---|---|
| (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities have been excluded from coverage. However, most public authorities (which in some Member States include schools and hospitals) cannot be considered to be professional investors. It is therefore necessary to ensure that deposits of all non-professional investors, including public authorities, can benefit from the protection offered by a DGS. | (5) The range of depositors that are currently protected through repayment by a DGS is motivated by the wish to protect non-professional investors, while professional investors are deemed not to need such protection. For that reason, public authorities have been excluded from coverage. However, most public authorities (which in some Member States include schools and hospitals) cannot be considered to be professional investors. It is therefore necessary to ensure that deposits of all non-professional investors, including small public authorities, can benefit from the protection offered by a DGS. |
In line with the overall objective to include in coverage some public sector entities which are not sophisticated depositors (such as schools, hospitals, some local services etc.), this amendment clarifies that central/regional governments should remain excluded from coverage. This would lower the risk to put part of the burden of sovereign risk on the DGS.
| Text proposed by the Commission | Amendment |
|---|---|
| (7) During a real estate transaction, the funds can transit through different accounts prior to the actual settlement of the transaction. Therefore, to protect depositors going through real estate transactions in a homogenous manner, protection of temporary high balances should apply to the proceeds of a sale as well as to the funds deposited for a purchase of a private residential property in the short-term. | (7) During a real estate transaction, the funds can transit through different accounts prior to the actual settlement of the transaction. Therefore, to protect depositors going through real estate transactions in a homogenous manner, protection of temporary high balances should apply to the proceeds of a sale as well as to the funds deposited for a purchase of a private residential property within a predefined short-term period. |
Practical experience from the DGSs has shown that things like transfers (e.g. from current to call accounts), categories (e.g. only owner-occupied real estate), etc. and the phrase “in the short term” need to be specified in more detail here.
| Text proposed by the Commission | Amendment |
|---|---|
| (16) Article 9 of Directive 2014/49/EU provides that where a DGS makes payments in the context of resolution proceedings, the DGS should have a claim against the credit institution concerned for an amount equal to its payments and that claim should rank pari passu with covered deposits. That provision does not distinguish between a DGS’s contribution when an open-bank bail-in tool is used, and DGS’s contribution to the financing of a transfer strategy (sale of business or bridge institution tool) followed by liquidation of the residual entity. To ensure clarity and legal certainty with respect to the existence and amount of a DGS’s claim in different scenarios, it is necessary to specify that when the DGS contributes to support the application of the sale of business tool or of the bridge institution tool, or alternative measures, whereby a set of assets, rights and liabilities, including deposits, of the credit institution are transferred to a recipient, that DGS should have a claim against the residual entity in its subsequent winding-up proceedings under national law. To ensure that the shareholders and creditors of the credit institution left behind in the residual entity effectively absorb the losses of that credit institution and improve the possibility of repayments in insolvency to the DGS, the DGS claim should have the same ranking as the depositors’ claim. In case the open bank bail-in tool is applied (i.e., the credit institution continues its operations), the DGS contributes in the amount by which covered deposits would have been written down or converted to absorb the losses in that credit institution, had covered deposits been included within the scope of bail-in. Therefore, the DGS’s contribution should not result in a claim against the institution under resolution as it would eliminate the purpose of the DGS’s contribution. | (16) Article 9 of Directive 2014/49/EU provides that where a DGS makes payments in the context of resolution proceedings, the DGS should have a claim against the credit institution concerned for an amount equal to its payments and that claim should rank pari passu with covered deposits. That provision does not distinguish between a DGS’s contribution when an open-bank bail-in tool is used, and DGS’s contribution to the financing of a transfer strategy (sale of business or bridge institution tool) followed by liquidation of the residual entity. To ensure clarity and legal certainty with respect to the existence and amount of a DGS’s claim in different scenarios, it is necessary to specify that when the DGS contributes to support the application of the sale of business tool or of the bridge institution tool, or alternative measures, whereby a set of assets, rights and liabilities, including deposits, of the credit institution are transferred to a recipient, that DGS should have a claim against the residual entity in its subsequent winding-up proceedings under national law. To ensure that the shareholders and creditors of the credit institution left behind in the residual entity effectively absorb the losses of that credit institution and improve the possibility of repayments in insolvency to the DGS, the DGS claim should have the same ranking as covered deposits. In case the open bank bail-in tool is applied (i.e., the credit institution continues its operations), the DGS contributes in the amount by which covered deposits would have been written down or converted to absorb the losses in that credit institution, had covered deposits been included within the scope of bail-in. Therefore, the DGS’s contribution should not result in a claim against the institution under resolution as it would eliminate the purpose of the DGS’s contribution. |
| Text proposed by the Commission | Amendment |
|---|---|
| (16) Article 9 of Directive 2014/49/EU provides that where a DGS makes payments in the context of resolution proceedings, the DGS should have a claim against the credit institution concerned for an amount equal to its payments and that claim should rank pari passu with covered deposits. That provision does not distinguish between a DGS’s contribution when an open-bank bail-in tool is used, and DGS’s contribution to the financing of a transfer strategy (sale of business or bridge institution tool) followed by liquidation of the residual entity. To ensure clarity and legal certainty with respect to the existence and amount of a DGS’s claim in different scenarios, it is necessary to specify that when the DGS contributes to support the application of the sale of business tool or of the bridge institution tool, or alternative measures, whereby a set of assets, rights and liabilities, including deposits, of the credit institution are transferred to a recipient, that DGS should have a claim against the residual entity in its subsequent winding-up proceedings under national law. To ensure that the shareholders and creditors of the credit institution left behind in the residual entity effectively absorb the losses of that credit institution and improve the possibility of repayments in insolvency to the DGS, the DGS claim should have the same ranking as the depositors’ claim. In case the open bank bail-in tool is applied (i.e., the credit institution continues its operations), the DGS contributes in the amount by which covered deposits would have been written down or converted to absorb the losses in that credit institution, had covered deposits been included within the scope of bail-in. Therefore, the DGS’s contribution should not result in a claim against the institution under resolution as it would eliminate the purpose of the DGS’s contribution. | (16) Article 9 of Directive 2014/49/EU provides that where a DGS makes payments in the context of resolution proceedings, the DGS should have a claim against the credit institution concerned for an amount equal to its payments and that claim should rank pari passu with covered deposits. That provision does not distinguish between a DGS’s contribution when an open-bank bail-in tool is used, and DGS’s contribution to the financing of a transfer strategy (sale of business or bridge institution tool) followed by liquidation of the residual entity. To ensure clarity and legal certainty with respect to the existence and amount of a DGS’s claim in different scenarios, it is necessary to specify that when the DGS contributes to support the application of the sale of business tool or of the bridge institution tool, or alternative measures, whereby a set of assets, rights and liabilities, including deposits, of the credit institution are transferred to a recipient, that DGS should have a claim against the residual entity in its subsequent winding-up proceedings under national law. To ensure that the shareholders and creditors of the credit institution left behind in the residual entity effectively absorb the losses of that credit institution and improve the possibility of repayments in insolvency to the DGS, the DGS claim should have the same ranking as covered deposits. In case the open bank bail-in tool is applied (i.e., the credit institution continues its operations), the DGS contributes in the amount by which covered deposits would have been written down or converted to absorb the losses in that credit institution, had covered deposits been included within the scope of bail-in. Therefore, the DGS’s contribution should not result in a claim against the institution under resolution as it would eliminate the purpose of the DGS’s contribution. |
This adaptation follows from the rejection of a single tiered depositor preference. The claim against the residual institution for a DGS should be preferred.
| Text proposed by the Commission | Amendment |
|---|---|
| (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. | (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. In consideration of the scope expansion for DGS use, the adequacy of the 0,8% target level should be subject to close monitoring and assessment. |
| Text proposed by the Commission | Amendment |
|---|---|
| (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. | (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members, or the lower target level where applicable. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. |
Article 10(6) DGSD currently foresees the possibility to set a lower target level below 0,8% under strict conditions and upon approval by the Commission. This provision should be kept.
| Text proposed by the Commission | Amendment |
|---|---|
| (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. | (18) Pursuant to Article 10(2) of Directive 2014/49/EU, it is confirmed that Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. |
| Text proposed by the Commission | Amendment |
|---|---|
| (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. | (18) Pursuant to Article 10(2) of Directive 2014/49/EU, it is confirmed that Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. |
| Text proposed by the Commission | Amendment |
|---|---|
| (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. To objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. | (18) Pursuant to Article 10(2) of Directive 2014/49/EU, Member States are to ensure that by 3 July 2024, the available financial means of a DGS reach a target level of 0,8 % of the amount of the covered deposits of its members. In order to objectively assess whether DGSs fulfil that requirement, a clear reference period should be set to determine the amount of covered deposits and DGSs’ available financial means. |
| Text proposed by the Commission | Amendment |
|---|---|
| (18a) Contributions to the DGS and the resolution financing arrangements should be determined in a manner that accurately assesses the likelihood of a contributing bank to impose losses for the DGS or the resolution financing arrangement. To that end, the rules governing contributions of individual banks to these funds shall mainly take into account the Minimum Requirement for Own Funds and Eligible Liabilities (MREL) capacity and quality of the concerned banks. |
This reform might change the likelihood of small and midsize banks to access the DGS / RF. This likelihood should be reflected in the contribution rules in order to set the right incentives on a “polluter-pays” model. The risk adjustment should primarily take into account the MREL capacity and quality of the concerned banks.
| Text proposed by the Commission | Amendment |
|---|---|
| (18b) The target level of the resolution financing arrangements and the DGS were determined in 2014 to withstand a certain adverse shock to the banking system given its loss absorption capacity at the time. Since then, the banking system has considerably increased its loss absorption capacity by building up its capital and MREL buffers, and by improving the overall asset quality, primarily with the reduction in NPLs. As a result, the same target level enables today to withstand a much bigger shock, which in turn means that there is no need to increase the target levels as a result of this review. |
This reform aims at using the funds more efficiently. The targeted amendments should not increase the burden on the funds to an extent that would outweigh the benefit of the significant risk reduction that has taken place since 2014 and which means that today the same target level enables to withstand a much larger shock.
| Text proposed by the Commission | Amendment |
|---|---|
| (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used as a last resort. | (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used as a last resort. This shall be without prejudice to the possibility of the central bank to provide temporary liquidity loans for the DGS. |
| Text proposed by the Commission | Amendment |
|---|---|
| (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used as a last resort. | (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used as a last resort, after all other options have been exhausted. |
| Text proposed by the Commission | Amendment |
|---|---|
| (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used as a last resort. | (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used in extraordinary cases of systemic nature. |
| Text proposed by the Commission | Amendment |
|---|---|
| (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used as a last resort. | (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used where they act as a last resort. |
| Text proposed by the Commission | Amendment |
|---|---|
| (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds should only be used as a last resort. | (22) It is necessary to enhance depositor protection, while avoiding the need for a fire sale of the assets of a DGS and limiting possible negative pro-cyclical effects over the banking industry caused by the collection of extraordinary contributions. DGSs should therefore be allowed to use alternative funding arrangements that enable them to obtain at any time short-term funding from sources other than contributions, including before using their available financial means and funds collected through extraordinary contributions. Because credit institutions should primarily bear the cost and responsibility for financing DGSs, alternative funding arrangements from public funds only be used where they act as a last resort. |
| Text proposed by the Commission | Amendment |
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| (22a) To avoid a DGS becoming insufficiently funded and unable to support a new intervention, robust and favourable alternative funding arrangements are required. Therefore, to prevent temporary financing by the Member States, and to ensure that it remains a last resort, the Single Resolution Board should be able to provide a guarantee based on the Single Resolution Fund to a DGS in order to facilitate its access to markets at favourable financing conditions. The Single Resolution Fund's guarantee should be provided when the DGS is required to intervene in resolution, yet available financial means are insufficient to satisfy the needs of such action. |
| Text proposed by the Commission | Amendment |
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| (22b) The provision of Single Resolution Fund guarantees to DGSs pursuing alternative funding arrangements must not preclude, nor delay, any progress in the establishment of a fully-fledged European deposit insurance scheme, which remains the optimal solution. |
| Text proposed by the Commission | Amendment |
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| (23) To ensure adequately diversified investment of DGS funds and convergent practices, the EBA should issue guidelines to provide DGSs with guidance in that respect. | deleted |
| Text proposed by the Commission | Amendment |
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| (23) To ensure adequately diversified investment of DGS funds and convergent practices, the EBA should issue guidelines to provide DGSs with guidance in that respect. | deleted |
| Text proposed by the Commission | Amendment |
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| (24a) It is essential that any involvement of the DGS in any scenario must be conducted with a stringent focus on cost-effectiveness and transparency. This approach is essential to avoid distorting the level playing field and ensuring that it does not confer unfair advantages to specific market participants. Transparency and cost-efficiency are fundamental principles that underpin the integrity and equitable functioning of the DGS. |
| Text proposed by the Commission | Amendment |
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| (25) Measures to prevent failure of a credit institution through sufficiently early interventions can play an effective role in the continuum of crisis management tools to maintain depositor confidence and financial stability. Those measures can take various forms - capital support measures through own funds instruments (including Common Equity Tier 1 instruments) or other capital instruments, guarantees, or loans. DGSs have had heterogeneous recourse to those measures. To ensure the continuum of crisis management tools and recourse to preventive measures in a manner consistent with the resolution framework and the state aid rules, it is necessary to specify the timing and conditions for their application. Preventive measures are not appropriate for the absorption of incurred losses when the credit institution is already failing or likely to fail and should be used early to prevent deterioration of the financial situation of the bank. Designated authorities should therefore verify whether the conditions for such DGS intervention have been fulfilled. Finally, those conditions for the use of DGS available financial means should be without prejudice to the assessment by the competent authority of whether an IPS fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 of the European Parliament and of the Council41 . | (25) Measures to prevent failure of a credit institution through sufficiently early interventions can play an effective role in the continuum of crisis management tools to maintain depositor confidence and financial stability. Those measures can take various forms - capital support measures through own funds instruments (including Common Equity Tier 1 instruments) or other capital instruments, guarantees, or loans. DGSs have had heterogeneous recourse to those measures. To ensure the continuum of crisis management tools and recourse to preventive measures in a manner consistent with the resolution framework and the state aid rules, it is necessary to specify the timing and conditions for their application. Preventive measures are not appropriate for the absorption of incurred losses when the credit institution is already failing or likely to fail and should be used early to prevent deterioration of the financial situation of the bank. Competent authorities should therefore confirm that the circumstances for failing or likely to fail are not met and that preventive measures are needed to secure the financial soundness and long-term viability of the credit institution. DGSs, or where relevant, designated authorities should then verify that the conditions for using DGSs’ available financial means in the context of preventive measures are met. Finally, those conditions for the use of DGS available financial means should be without prejudice to the assessment by the competent authority of whether an IPS fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 of the European Parliament and of the Council41 . |
| 41 Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1). | 41 Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1). |
| Text proposed by the Commission | Amendment |
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| (26) To ensure that preventive measures achieve their objective, credit institutions should be required to prepare a note outlining the measures that they commit to undertake. The preparation of such note should not be too burdensome and time-consuming for the credit institution to ensure the possibility for the DGS to intervene early enough. Therefore, the note accompanying preventive measures should take the form of a sufficiently short explanatory document. Such note should contain all elements which aim at preventing the outflow of funds and strengthening the capital and liquidity position of the credit institution, enabling the credit institution to comply with all the relevant prudential and other regulatory requirements on a forward-looking basis. Such note should therefore contain capital raising measures, including rules on the issuance of rights, the voluntary conversion of subordinated debt instruments, liability management exercises, capital generating sales of assets, the securitisation of portfolios, and earnings retention, including dividend bans and bans on the acquisition of stakes in undertakings. For the same reason, during the implementation of the measures envisaged in the note, credit institutions should also strengthen their liquidity positions and refrain from aggressive commercial practices, and from the repurchasing of own shares or call hybrid capital instruments. Such note should also contain an exit strategy for any support measures received. Competent authorities are best positioned to be consulted on the relevance and credibility of the measures envisaged in the note. To ensure that the designated authorities of the DGS that is requested to finance a preventive measure by the credit institution can assess that all the conditions for preventive measures are fulfilled, the competent authorities should cooperate with the designated authorities. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a note. | (26) To ensure that preventive measures achieve their objective, credit institutions should be required to prepare a note outlining the measures that they commit to undertake and also providing a restructuring plan. Such note should contain all elements which aim at preventing the outflow of funds and strengthening the capital and liquidity position of the credit institution, enabling the credit institution to comply with all the relevant prudential and other regulatory requirements on a forward-looking basis. Such note should therefore contain capital raising measures, including rules on the issuance of rights, the voluntary conversion of subordinated debt instruments, liability management exercises, capital generating sales of assets, the securitisation of portfolios, and earnings retention, including dividend bans and bans on the acquisition of stakes in undertakings. For the same reason, during the implementation of the measures envisaged in the note, credit institutions should also strengthen their liquidity positions and refrain from aggressive commercial practices, and from the repurchasing of own shares or call hybrid capital instruments. Such note should also contain an exit strategy for any support measures received. Competent authorities are to be consulted on the relevance and credibility of the measures envisaged in the note. No preventive measure should be implemented without prior approval of the competent authority at the end of this consultation. To ensure that the designated authorities of the DGS that is requested to finance a preventive measure by the credit institution can assess that all the conditions for preventive measures are fulfilled, the competent authorities should cooperate with the designated authorities. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a note. |
| Text proposed by the Commission | Amendment |
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| (26) To ensure that preventive measures achieve their objective, credit institutions should be required to prepare a note outlining the measures that they commit to undertake. The preparation of such note should not be too burdensome and time-consuming for the credit institution to ensure the possibility for the DGS to intervene early enough. Therefore, the note accompanying preventive measures should take the form of a sufficiently short explanatory document. Such note should contain all elements which aim at preventing the outflow of funds and strengthening the capital and liquidity position of the credit institution, enabling the credit institution to comply with all the relevant prudential and other regulatory requirements on a forward-looking basis. Such note should therefore contain capital raising measures, including rules on the issuance of rights, the voluntary conversion of subordinated debt instruments, liability management exercises, capital generating sales of assets, the securitisation of portfolios, and earnings retention, including dividend bans and bans on the acquisition of stakes in undertakings. For the same reason, during the implementation of the measures envisaged in the note, credit institutions should also strengthen their liquidity positions and refrain from aggressive commercial practices, and from the repurchasing of own shares or call hybrid capital instruments. Such note should also contain an exit strategy for any support measures received. Competent authorities are best positioned to be consulted on the relevance and credibility of the measures envisaged in the note. To ensure that the designated authorities of the DGS that is requested to finance a preventive measure by the credit institution can assess that all the conditions for preventive measures are fulfilled, the competent authorities should cooperate with the designated authorities. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a note. | (26) To ensure that preventive measures achieve their objective, credit institutions should be required to prepare a restructuring plan outlining the measures that they commit to undertake. The preparation of such note should not be too burdensome and time-consuming for the credit institution to ensure the possibility for the DGS or the competent authority to intervene early enough. Such restructuring plan should contain all elements which aim at preventing the outflow of funds and strengthening the capital and liquidity position of the credit institution, enabling the credit institution to comply with all the relevant prudential and other regulatory requirements on a forward-looking basis. Such restructuring plan should therefore contain capital raising measures, including rules on the issuance of rights, the voluntary conversion of subordinated debt instruments, liability management exercises, capital generating sales of assets, the securitisation of portfolios, and earnings retention, including dividend bans and bans on the acquisition of stakes in undertakings. For the same reason, during the implementation of the measures envisaged in the restructuring plan , credit institutions should also strengthen their liquidity positions and refrain from aggressive commercial practices, and from the repurchasing of own shares or call hybrid capital instruments. Such restructuring plan should also contain an exit strategy for any support measures received. Competent authorities are best positioned to be consulted on the relevance and credibility of the measures envisaged in the restructuring plan . To ensure that the designated authorities of the DGS that is requested to finance a preventive measure by the credit institution can assess that all the conditions for preventive measures are fulfilled, the competent authorities should cooperate with the designated authorities. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a restructuring plan |
| Text proposed by the Commission | Amendment |
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| (26) To ensure that preventive measures achieve their objective, credit institutions should be required to prepare a note outlining the measures that they commit to undertake. The preparation of such note should not be too burdensome and time-consuming for the credit institution to ensure the possibility for the DGS to intervene early enough. Therefore, the note accompanying preventive measures should take the form of a sufficiently short explanatory document. Such note should contain all elements which aim at preventing the outflow of funds and strengthening the capital and liquidity position of the credit institution, enabling the credit institution to comply with all the relevant prudential and other regulatory requirements on a forward-looking basis. Such note should therefore contain capital raising measures, including rules on the issuance of rights, the voluntary conversion of subordinated debt instruments, liability management exercises, capital generating sales of assets, the securitisation of portfolios, and earnings retention, including dividend bans and bans on the acquisition of stakes in undertakings. For the same reason, during the implementation of the measures envisaged in the note, credit institutions should also strengthen their liquidity positions and refrain from aggressive commercial practices, and from the repurchasing of own shares or call hybrid capital instruments. Such note should also contain an exit strategy for any support measures received. Competent authorities are best positioned to be consulted on the relevance and credibility of the measures envisaged in the note. To ensure that the designated authorities of the DGS that is requested to finance a preventive measure by the credit institution can assess that all the conditions for preventive measures are fulfilled, the competent authorities should cooperate with the designated authorities. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a note. | (26) To ensure that preventive measures achieve their objective, credit institutions should be required to prepare a note outlining the measures that they commit to undertake. The preparation of such note should not be too burdensome and time-consuming for the credit institution to ensure the possibility for the DGS to intervene early enough. Therefore, the note accompanying preventive measures should take the form of a sufficiently short explanatory document. Such note should contain all elements which aim at preventing the outflow of funds and strengthening the capital and liquidity position of the credit institution, enabling the credit institution to comply with all the relevant prudential and other regulatory requirements on a forward-looking basis. Such note should therefore contain capital raising measures, including rules on the issuance of rights, the voluntary conversion of subordinated debt instruments, liability management exercises, capital generating sales of assets, the securitisation of portfolios, and earnings retention, including dividend bans and bans on the acquisition of stakes in undertakings. For the same reason, during the implementation of the measures envisaged in the note, credit institutions should also strengthen their liquidity positions and refrain from aggressive commercial practices, and from the repurchasing of own shares or call hybrid capital instruments. Such note should also contain an exit strategy for any support measures received. Competent authorities are best positioned to assess the relevance and credibility of the measures envisaged in the note. To ensure that the designated authorities of the DGS that is requested to finance a preventive measure by the credit institution can assess that all the conditions for preventive measures are fulfilled, the competent authorities should cooperate with the designated authorities. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a note. |
| Text proposed by the Commission | Amendment |
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| (27) To ensure that credit institutions receiving support from DGSs in the form of preventive measures deliver on their commitments, competent authorities should request a remediation plan from credit institutions that failed to fulfil their commitments. Where a competent authority is of the opinion that the measures in the remediation plan are not capable of achieving the credit institution’s long-term viability, the DGS should not provide any further preventive support to the credit institution. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a remediation plan. | (27) To ensure that credit institutions receiving support from DGSs in the form of preventive measures deliver on their commitments, competent authorities should request a remediation plan from credit institutions that failed to fulfil their commitments or to repay the amount contributed under the preventive measures. Where a competent authority is of the opinion that the measures in the remediation plan are not capable of achieving the credit institution’s long-term viability, the DGS should not provide any further preventive support to the credit institution and the relevant authorities should carry out an assessment on whether the institution is failing or is likely to fail, in accordance with Article 32 of Directive 2014/59/EU. The same consequences should apply in cases where the credit institution fails to comply with the remediation plan or fails to repay the preventive measures. To ensure a consistent approach to the application of preventive measures across the Union, the EBA should issue guidelines to assist credit institutions to draft such a remediation plan. |
| Text proposed by the Commission | Amendment |
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| (28) To avoid detrimental effects on competition and on the internal market, it is necessary to lay down that in the case of alternative measures in insolvency, relevant bodies representing a credit institution in the context of national insolvency proceedings (liquidator, receiver, administrator or other) should make arrangements for the marketing of the business of the credit institution or part of it in an open, transparent and non-discriminatory process, while aiming to maximise, as far as possible, the sale price. The credit institution or any intermediary acting on behalf of the credit institution should apply rules that are adequate for the marketing of assets, rights and liabilities that are to be transferred to potential purchasers. In any event, the use of State resources should remain subject to the relevant State aid rules under the Treaty, where applicable. | (28) To avoid detrimental effects on competition and on the internal market, it is necessary to lay down that in the case of alternative measures in insolvency, relevant bodies representing a credit institution in the context of national insolvency proceedings (liquidator, receiver, administrator or other) should make arrangements for the marketing of the business of the credit institution or part of it in an open, transparent and non-discriminatory process, while aiming to maximise, as far as possible, the sale price. The credit institution or any intermediary acting on behalf of the credit institution should apply rules that are adequate for the marketing of assets, rights and liabilities that are to be transferred to potential purchasers. In any event, the use of State resources should remain subject to the relevant State aid rules under the Treaty, where applicable. State resources should only be used in extraordinary circumstances when an event occurs of a systemic nature or pertaining to very large economic turmoil, as it imposes a significant burden on public finances and disrupts the level playing field in the internal market. |
| Text proposed by the Commission | Amendment |
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| (28) To avoid detrimental effects on competition and on the internal market, it is necessary to lay down that in the case of alternative measures in insolvency, relevant bodies representing a credit institution in the context of national insolvency proceedings (liquidator, receiver, administrator or other) should make arrangements for the marketing of the business of the credit institution or part of it in an open, transparent and non-discriminatory process, while aiming to maximise, as far as possible, the sale price. The credit institution or any intermediary acting on behalf of the credit institution should apply rules that are adequate for the marketing of assets, rights and liabilities that are to be transferred to potential purchasers. In any event, the use of State resources should remain subject to the relevant State aid rules under the Treaty, where applicable. | (28) To avoid detrimental effects on competition and on the internal market, it is necessary to lay down that in the case of alternative measures in insolvency, relevant bodies representing a credit institution in the context of national insolvency proceedings (liquidator, receiver, administrator or other) should make arrangements for the marketing of the business of the credit institution or part of it in an open, transparent and non-discriminatory process, while aiming to maximise, as far as possible, the sale price. The credit institution or any intermediary acting on behalf of the credit institution should apply rules that are adequate for the marketing of assets, rights and liabilities that are to be transferred to potential purchasers. In any event, the use of DGS resources should be subject to the same conditions that would apply to State resources subject to relevant State aid rules under the Treaty. |
| Text proposed by the Commission | Amendment |
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| (29) Since the main aim of DGSs is to protect covered deposits, DGSs should only be allowed to finance interventions other than payouts where such interventions are cheaper than payouts. Experience with the application of that rule (‘least cost test’) has revealed several shortcomings as the current framework does not detail how to determine the cost of those interventions nor the cost of the payout. To ensure a consistent application of the least cost test across the Union, it is necessary to specify the calculation of those costs. At the same time, it is necessary to avoid excessively stringent conditions that would effectively disable the use of DGS funds for other interventions than payout. When carrying out the least cost assessment, DGSs should first verify that the cost to finance the selected measure is lower than the cost of reimbursement of covered deposits. The methodology for the least cost assessment should take into account the time value of money. | (29) Since the main aim of DGSs is to protect covered deposits, DGSs should only be allowed to finance interventions other than payouts where such interventions are more efficient than payouts and are able to ensure, in a more effective way, the depositors’ access to their deposits . Experience with the application of that rule (‘least cost test’) has revealed several shortcomings as the current framework does not detail how to determine the cost of those interventions nor the cost of the payout. To ensure a consistent application of the least cost test across the Union, it is necessary to specify the calculation of those costs. At the same time, it is necessary to avoid excessively stringent conditions that would effectively disable the use of DGS funds for other interventions than payout. When carrying out the least cost assessment, DGSs should first verify that the cost to finance the selected measure is lower than the cost of reimbursement of covered deposits. The methodology for the least cost assessment should take into account the time value of money. |
| Text proposed by the Commission | Amendment |
|---|---|
| (31) The designated authorities should estimate the cost of the measure for the DGS, including after the repayment of a loan, a capital injection or the use of a guarantee, net of expected earnings, operational expenses, and potential losses, against a counterfactual based on a hypothetical final loss at the end of the insolvency proceedings, which should take into account recoveries from the DGS as part of a bank’s liquidation proceedings. To give a fair and more comprehensive picture of the actual cost of depositors’ repayment, the estimation of the loss incurred due to the reimbursement of covered deposits should include costs indirectly related to the reimbursement of depositors. Such costs should include the cost of replenishment of the DGS and the cost that the DGS might bear due to the recourse to alternative financing. To ensure consistent application of the least cost test, the EBA should develop draft regulatory technical standards on the methodology to calculate the cost of different DGS interventions. To ensure consistency of the methodology for the least cost assessment with the DGS statutory or contractual mandate as regards preventive measures, the EBA should, when developing those draft regulatory technical standards, take into account the relevance of preventive measures in the methodology for the calculation of the payout counterfactual. | (31) The designated authorities should estimate the cost of the measure for the DGS, including after the repayment of a loan, a capital injection or the use of a guarantee, net of expected earnings, operational expenses, and potential losses, against a counterfactual based on a hypothetical final loss at the end of the insolvency proceedings, which should take into account recoveries from the DGS as part of a bank’s liquidation proceedings. To give a fair and more comprehensive picture of the actual cost of depositors’ repayment, the estimation of the loss incurred due to the reimbursement of covered deposits should include costs directly related to the reimbursement of depositors. Such costs should include the cost of replenishment of the DGS and the cost that the DGS might bear due to the recourse to alternative financing. To ensure consistent application of the least cost test, the EBA should develop draft regulatory technical standards on the methodology to calculate the cost of different DGS interventions. To ensure consistency of the methodology for the least cost assessment with the DGS statutory or contractual mandate as regards preventive measures, the EBA should, when developing those draft regulatory technical standards, take into account the relevance of preventive measures in the methodology for the calculation of the payout counterfactual. |
| Text proposed by the Commission | Amendment |
|---|---|
| (33) The cooperation between DGSs across the Union is vital to ensure fast and cost-efficient depositors’ repayment where credit institutions conduct banking service through branches in other Member States. In view of technological advancements that promote the use of cross-border transfers and remote identification, the DGS of the home Member State should be allowed to make the repayments directly to depositors at branches located in another Member State, provided that the administrative burden and costs are lower than if the repayment would be carried out by the DGS of the host Member State. That flexibility should complement the current cooperation mechanism, requiring the DGS of the host Member State to repay depositors in branches on behalf of the DGS of the home Member State. To preserve depositor confidence in both host and home Member States, EBA should issue guidelines to assist the DGSs in such cooperation, inter alia by suggesting a list of conditions under which a DGS of the home Member State could decide to reimburse depositors at branches located in the host Member State. | (33) The cooperation between DGSs across the Union is vital to ensure fast and cost-efficient depositors’ repayment where credit institutions conduct banking service through branches in other Member States. In view of technological advancements that promote the use of cross-border transfers and remote identification, the DGS of the home Member State should be allowed to make the repayments directly to depositors at branches located in another Member State, provided that the administrative burden and costs are lower than if the repayment would be carried out by the DGS of the host Member State. That flexibility should complement the current cooperation mechanism, requiring the DGS of the host Member State to repay depositors in branches on behalf of the DGS of the home Member State. To preserve depositor confidence in both host and home Member States, EBA should issue guidelines under consideration of available expertise shared by EFDI to assist the DGSs in such cooperation, inter alia by suggesting a list of conditions under which a DGS of the home Member State could decide to reimburse depositors at branches located in the host Member State. |
Possible EBA guidelines should considerate available information and experience of EFDI to reflect a practioners view.
| Text proposed by the Commission | Amendment |
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| (34) Credit institutions may change affiliation to a DGS because they move their headquarters to another Member State or convert their subsidiary into a branch or vice versa. Article 14(3) of Directive 2014/49/EU requires that the contributions of that credit institution paid during the 12 months preceding the transfer are transferred to the other DGS in proportion to the amount of covered deposits transferred. To ensure that the transfer of contributions to the receiving DGS is not dependent on divergent national rules regarding invoicing or actual date of payment of contributions, the DGS of origin should calculate the amount to be transferred on the basis of contributions due rather than contributions paid. | (34) Credit institutions may change affiliation to a DGS because they move their headquarters to another Member State or convert their subsidiary into a branch or vice versa. Article 14(3) of Directive 2014/49/EU requires that the contributions of that credit institution paid during the 12 months preceding the transfer are transferred to the other DGS in proportion to the amount of covered deposits transferred. To ensure that the transfer of contributions to the receiving DGS is not dependent on divergent national rules regarding invoicing or actual date of payment of contributions, the DGS of origin should calculate the amount to be transferred on the basis of the methodology to be developed by the EBA. |
| Text proposed by the Commission | Amendment |
|---|---|
| (34) Credit institutions may change affiliation to a DGS because they move their headquarters to another Member State or convert their subsidiary into a branch or vice versa. Article 14(3) of Directive 2014/49/EU requires that the contributions of that credit institution paid during the 12 months preceding the transfer are transferred to the other DGS in proportion to the amount of covered deposits transferred. To ensure that the transfer of contributions to the receiving DGS is not dependent on divergent national rules regarding invoicing or actual date of payment of contributions, the DGS of origin should calculate the amount to be transferred on the basis of contributions due rather than contributions paid. | (34) Credit institutions may change affiliation to a DGS because they move their headquarters to another Member State or convert their subsidiary into a branch or vice versa. The contributions of that credit institution paid preceding the transfer, net of any disbursement and pro rata, should be transferred to the other DGS in proportion to the amount of covered deposits transferred. To ensure that the transfer of contributions to the receiving DGS is not dependent on divergent national rules regarding invoicing or actual date of payment of contributions, the DGS of origin should calculate the amount to be transferred on the basis of contributions due rather than contributions paid. |
The change of DGS membership transfers all the risk from the original DGS to the new DGS. And there is no rationale for paying twice a contribution for the same risk. Unless this provision is amended, it imposes a significant cost on any crossborder re-organisation, specifically through “branchification”, as pointed out by the SSM President in September 2021.The amount to be transferred should be close to the total amount paid by the related credit institution (with the exception of extraordinary contributions and part of the contributions used for past interventions).
| Text proposed by the Commission | Amendment |
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| (36) Standardised and regular information disclosure enhances awareness of depositors about deposit protection. To align disclosure requirements with technological developments, those requirements should take into account the new digital communication channels whereby credit institutions interact with depositors. Depositors should obtain clear and homogeneous information that explains their deposit protection, while limiting the related administrative burden for credit institutions or DGSs. The EBA should be mandated to develop draft implementing technical standards to specify, on the one hand, the content and format of the depositor information sheet to communicate to depositors on annual basis and, on the other hand, the template information that either DGSs or credit institutions are required to communicate to depositors in specific situations, including mergers of credit institutions, determination that deposits are unavailable, or repayment of client funds deposits. | (36) Standardised and regular information disclosure enhances awareness of depositors about deposit protection. To align disclosure requirements with technological developments, those requirements should take into account the new digital communication channels whereby credit institutions interact with depositors. Depositors should obtain clear and homogeneous information that explains their deposit protection, while limiting the related administrative burden for credit institutions or DGSs. The EBA should be mandated to develop draft implementing technical standards to specify, on the one hand, the content and format of the depositor information sheet to communicate to depositors on annual basis. |
It is not the task of a DGS to inform depositors of a merger. The information about deposits becoming unavailable, or the repayment of client funds deposits is to be provided by DGS in an authoritative manner but should not be uniformly prescribed via an EBA template. The type of information provided by a DGS in such a case strongly depends on the national circumstances and respective processes in place and should be left to the discretion of the DGS.
| Text proposed by the Commission | Amendment |
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| (37) The merger of a credit institution or the conversion of subsidiary into branch or vice versa might affect the key features of depositor protection. To avoid adverse impacts on depositors that would have deposits in both merging banks and whose claim to deposit coverage would be reduced because of changes to DGS affiliation, all depositors should be informed about such changes and should have the right to withdraw their funds without incurring a penalty up to an amount equal to the lost coverage of deposits. | (37) The merger of a credit institution or the conversion of subsidiary into branch or vice versa might affect the key features of depositor protection. To avoid adverse impacts on depositors that would have deposits in both merging banks and whose claim to deposit coverage would be reduced because of changes to DGS affiliation, all depositors should be informed about such changes. Depositors should have the right to withdraw their funds without incurring a penalty up to an amount equal to the lost coverage of deposits. |
| Text proposed by the Commission | Amendment |
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| (38) To preserve financial stability, avoid contagion and enable depositors to exercise their rights to claim deposits when applicable, designated authorities, DGSs and credit institutions concerned should inform depositors about deposits becoming unavailable. | (38) To preserve financial stability, avoid contagion and enable depositors to exercise their rights to claim deposits when applicable, DGSs should inform depositors about deposits becoming unavailable. |
The DGS should be the authoritative source of information in such a case; the information by three different agencies causes unnecessary coordination effort without providing added value, on the contrary, it might lead to confusion among depositors.
| Text proposed by the Commission | Amendment |
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| (39) To increase transparency for depositors and to promote financial robustness and trust among DGSs when fulfilling their mandate, the current reporting requirements should be improved. Building on the current requirements that enable DGSs to request all necessary information from their member institutions to prepare for payout, DGSs should also be able to request information necessary to prepare for a payout in the context of cross border cooperation. Upon the request from a DGS, member institutions should be required to provide general information about any material cross-border business in other Member States. Likewise, in order to provide the EBA with the suitable range of information on the evolution of the DGSs’ available financial means and on the use of those means, Member States should ensure that DGSs inform the EBA on a yearly basis of the amount of covered deposits and available financial means, and notify the EBA about the circumstances that led to the use of DGS funds either for payouts or other measures. Finally, to reflect the strengthened role of DGSs in the bank crisis management which aims to facilitate the use of DGS funds in resolution, DGSs should have the right to receive the summary of resolution plans of credit institutions to increase their general preparedness to make the funds available. | (39) To increase transparency for depositors and to promote financial robustness and trust among DGSs when fulfilling their mandate, the current reporting requirements should be improved. Building on the current requirements that enable DGSs to request all necessary information from their member institutions to prepare for payout, DGSs should also be able to request information necessary to prepare for a payout in the context of cross border cooperation. Upon the request from a DGS, member institutions should be required to provide general information about any material cross-border business in other Member States. Likewise, in order to provide the EBA with the suitable range of information on the evolution of the DGSs’ available financial means and on the use of those means, Member States should ensure that DGSs inform the EBA on a yearly basis of the amount of covered deposits and available financial means, and notify the EBA about instances of the use of DGS funds either for payouts or other measures. Finally, to reflect the strengthened role of DGSs in the bank crisis management DGSs should receive the summary of resolution plans of credit institutions on an annual basis to increase their general preparedness to make the funds available. |
The circumstances leading to a usage of funds do not deliver meaningful information regarding the evolution of the DGSs’ available financial means. Regular access to information about resolution plans for DGS should be independent of their potential future role in resolution. Improvement of cooperation and exchange of information between DGS and resolution authorities is in line with best practice.
| Text proposed by the Commission | Amendment |
|---|---|
| (40) Technical standards in financial services should facilitate consistent harmonisation and adequate protection of depositors across the Union. As a body with highly specialised expertise, it would be efficient and appropriate to entrust the EBA with the development of draft regulatory and implementing technical standards which do not involve policy choices, for adoption by the Commission. | (40) In certain cases, technical standards in financial services can facilitate consistent harmonisation and adequate protection of depositors across the Union. Where there is an actual need in practice for more detailed provisions, these should be included in the Level-1 Legal Text where feasible. Alternatively, as a body with highly specialised expertise, it could exceptionally be efficient and appropriate to entrust the EBA with the development of draft regulatory and implementing technical standards which do not involve policy choices, for adoption by the Commission. This should be preceded by a cost-benefit analysis and an assessment of the associated administrative burden. |
The EBA is not a democratically legitimized body, therefore its influence on legal texts should be restricted. Instead, level-1-texts should be preferred where sensible and feasible.
| Text proposed by the Commission | Amendment |
|---|---|
| (45) Directive 2014/49/EU allows Member States to recognise an IPS as a DGS if it fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 and complies with Directive 2014/49/EU. To take into account the specific business model of those IPSs, in particular the relevance of preventive measures at the core of their mandate, it is appropriate to provide for the possibility of Member States to allow IPSs to adapt to the new safeguards for the application of preventive measures within a 6-year period. This possibly longer compliance period takes into account the timeline for the build-up of a segregated fund for IPS purposes other than deposit insurance as agreed between the European Central Bank, the national competent authority and the relevant IPSs. | (45) Directive 2014/49/EU allows Member States to recognise an IPS as a DGS if it fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 and complies with Directive 2014/49/EU. To take into account the specific business model of those IPSs, in particular the relevance of preventive measures at the core of their mandate and their proven functioning with positive effects on depositor confidence and financial stability, it is appropriate to provide for the possibility of Member States to keep the respective provisions of Directive 2014/49/EU. |
The necessary change for recital 45 is a result of our proposed and substantive amendments for Articles 11 and 11a to e (see below) as well as of the objective to comply with the Eurogroup Statement from June 2022.
| Text proposed by the Commission | Amendment |
|---|---|
| (45) Directive 2014/49/EU allows Member States to recognise an IPS as a DGS if it fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 and complies with Directive 2014/49/EU. To take into account the specific business model of those IPSs, in particular the relevance of preventive measures at the core of their mandate, it is appropriate to provide for the possibility of Member States to allow IPSs to adapt to the new safeguards for the application of preventive measures within a 6-year period. This possibly longer compliance period takes into account the timeline for the build-up of a segregated fund for IPS purposes other than deposit insurance as agreed between the European Central Bank, the national competent authority and the relevant IPSs. | (45) Directive 2014/49/EU allows Member States to recognise an IPS as a DGS if it fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 and complies with Directive 2014/49/EU. To take into account the specific business model of those IPSs, in particular the relevance of preventive measures contributing to financial stability at the core of their mandate, the possible need for IPS to adapt to the new safeguards for the application of preventive measures within a 6-year period should be verified and approved by national competent authorities and the relevant IPS. |
| Text proposed by the Commission | Amendment |
|---|---|
| (45) Directive 2014/49/EU allows Member States to recognise an IPS as a DGS if it fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 and complies with Directive 2014/49/EU. To take into account the specific business model of those IPSs, in particular the relevance of preventive measures at the core of their mandate, it is appropriate to provide for the possibility of Member States to allow IPSs to adapt to the new safeguards for the application of preventive measures within a 6-year period. This possibly longer compliance period takes into account the timeline for the build-up of a segregated fund for IPS purposes other than deposit insurance as agreed between the European Central Bank, the national competent authority and the relevant IPSs. | (45) Directive 2014/49/EU allows Member States to recognise an IPS as a DGS if it fulfils the criteria laid down in Article 113(7) of Regulation (EU) No 575/2013 and complies with Directive 2014/49/EU. To take into account the specific business model of those IPSs, in particular the relevance of preventive measures at the core of their mandate, it is appropriate to provide for the possibility of Member States to allow IPSs to adapt to the new safeguards for the application of preventive measures within a 3-year period. This possibly longer compliance period takes into account the timeline for the build-up of a segregated fund for IPS purposes other than deposit insurance as agreed between the European Central Bank, the national competent authority and the relevant IPSs. |
| Text proposed by the Commission | Amendment |
|---|---|
| (46) To allow DGSs and designated authorities to build up the necessary operational capacity to apply the new rules on the use of preventive measures, it is appropriate to provide for a deferred application of those new rules. | (46) To allow, where applicable, DGSs and designated authorities to build up the necessary operational capacity to apply the new rules on the use of preventive measures, it is appropriate to provide for a deferred application of those new rules. |
Our proposed amendments generally refer to preventive measures by IPSs that are officially recognised as DGS, but not necessarily to those by non-IPSs. The amendment proposed here results from this context.
| Text proposed by the Commission | Amendment |
|---|---|
| (47a) Together with the CMDI reform, pooling funds into a shared scheme through the introduction of an EDIS would offer a higher level of financial protection and confidence to EU’s households and businesses, increase trust and strengthen financial stability as necessary conditions for growth, prosperity and resilience in the Economic and Monetary Union and in the EU more generally. The first step of EDIS could be liquidity support only, while subsequent steps would remain on the horizon. Complementing the CMDI reform with liquidity support from EDIS would strengthen the ability of the deposit insurance system in the Banking Union and deliver synergies and efficiency gains for the industry. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. This Directive lays down rules and procedures relating to the establishment and the functioning of deposit guarantee schemes (DGSs), the coverage and repayment of deposits, and the use of DGS funds for measures that aim to ensure the access of depositors to their deposits.; | 1. This Directive lays down rules and procedures relating to the establishment and the functioning of deposit guarantee schemes (DGSs), the coverage and repayment of deposits, the use of DGS funds for measures that aim to ensure the access of depositors to their deposits, and the rules governing DGSs’ access to the Single Resolution Fund (SRF) guarantee, as provided in Article 79a of Regulation 806/2014.; |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. This Directive lays down rules and procedures relating to the establishment and the functioning of deposit guarantee schemes (DGSs), the coverage and repayment of deposits, and the use of DGS funds for measures that aim to ensure the access of depositors to their deposits.; | 1. This Directive lays down rules and procedures relating to the establishment and the functioning of deposit guarantee schemes (DGSs), the coverage and repayment of deposits, and the use of DGS funds for measures that aim to ensure the access of depositors to their deposits, and the rules governing DGSs’ access to, and the exchange of information with, the EU credit line and guarantee; |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. This Directive lays down rules and procedures relating to the establishment and the functioning of deposit guarantee schemes (DGSs), the coverage and repayment of deposits, and the use of DGS funds for measures that aim to ensure the access of depositors to their deposits.; | 1. This Directive lays down rules and procedures relating to the establishment and the functioning of deposit guarantee schemes (DGSs), the coverage and repayment of deposits, and the use of DGS funds for measures that aim to ensure the purpose of deposit insurance. |
The formulation should be less specific to encompass all purposes of deposit insurance interventions.
| Text proposed by the Commission | Amendment |
|---|---|
| (20) ‘client funds deposits’ means funds that account holders that are financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013 deposit in the course of their business with a credit institution for the account of their clients; | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| (20) ‘client funds deposits’ means funds that account holders that are financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013 deposit in the course of their business with a credit institution for the account of their clients; | (20) ‘client funds deposits’ means funds that account holders that are financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013 or credit servicer as defined in Article 3, point 8, of Directive (EU) 2021/2167 deposit in the course of their business with a credit institution for the account of their clients; |
| Text proposed by the Commission | Amendment |
|---|---|
| (20) ‘client funds deposits’ means funds that account holders that are financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013 deposit in the course of their business with a credit institution for the account of their clients; | (20) ‘client funds deposits’ means funds that account holders that are financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013 deposit in the course of their business in scope of Directive (EU) 2015/2366, Directive 2009/110/EC and Commission Delegated Directive (EU) 2017/593 with a credit institution for the account of their clients; |
| Text proposed by the Commission | Amendment |
|---|---|
| (20) ‘client funds deposits’ means funds that account holders that are financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013 deposit in the course of their business with a credit institution for the account of their clients; | (20) ‘client funds deposits’ means funds that account holders that are financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013 deposit in the course of their business in scope of Directive (EU) 2015/2366, Directive 2009/110/EC and Commission Delegated Directive (EU) 2017/593 with a credit institution for the account of their clients; |
The draft definition with references to ‘financial institutions as defined in Article 4(1), point (26), of Regulation (EU) No 575/2013’ (CRR II) and the ‘deposit in the course of their business’ is too broad and should be limited to the use cases that the EBA and the Commission have examined in advance. Otherwise, this can lead to inconsistencies and significant administrative consequences that were neither intended nor evaluated in advance.
| Text proposed by the Commission | Amendment |
|---|---|
| 4. Members States shall ensure that where a credit institution does not comply with its obligations as a member of a DGS, that DGS shall immediately notify the competent authority of that credit institution thereof. Member States shall ensure that the competent authority, in cooperation with that DGS, uses the supervisory powers laid down in Directive 2013/36/EU, and promptly takes all measures to ensure that the credit institution concerned complies with its obligations, including where necessary by imposing administrative penalties and other administrative measures in accordance with the national laws adopted in addition to the implementation of provisions of Title VII, Chapter 1, Section IV, of Directive 2013/36/EU.; | 4. Members States shall ensure that where a credit institution does not comply with its obligations as a member of a DGS, that DGS shall immediately notify the competent authority of that credit institution thereof. Member States shall ensure that the designated authority promptly takes all appropriate measures, including, if necessary, the imposition of penalties, to ensure that credit institutions comply with their obligations as members of a DGS. Member States shall lay down rules on penalties applicable in the event of infringements by credit institutions of the obligations incumbent on them as a member of a DGS. The penalties shall be effective, proportionate and dissuasive.’ |
| Text proposed by the Commission | Amendment |
|---|---|
| 4. Members States shall ensure that where a credit institution does not comply with its obligations as a member of a DGS, that DGS shall immediately notify the competent authority of that credit institution thereof. Member States shall ensure that the competent authority, in cooperation with that DGS, uses the supervisory powers laid down in Directive 2013/36/EU, and promptly takes all measures to ensure that the credit institution concerned complies with its obligations, including where necessary by imposing administrative penalties and other administrative measures in accordance with the national laws adopted in addition to the implementation of provisions of Title VII, Chapter 1, Section IV, of Directive 2013/36/EU.; | 4. Members States shall ensure that where a credit institution does not comply with its obligations as a member of a DGS, that DGS shall immediately notify the designated authority and the competent authority of that credit institution thereof. Member States shall ensure that the competent authority, in cooperation with that designated authority, uses the supervisory powers laid down in Directive 2013/36/EU, and promptly takes all measures to ensure that the credit institution concerned complies with its obligations, including where necessary by imposing administrative penalties and other administrative measures in accordance with the national laws adopted in addition to the implementation of provisions of Title VII, Chapter 1, Section IV, of Directive 2013/36/EU.; |
| Text proposed by the Commission | Amendment |
|---|---|
| 4. Members States shall ensure that where a credit institution does not comply with its obligations as a member of a DGS, that DGS shall immediately notify the competent authority of that credit institution thereof. Member States shall ensure that the competent authority, in cooperation with that DGS, uses the supervisory powers laid down in Directive 2013/36/EU, and promptly takes all measures to ensure that the credit institution concerned complies with its obligations, including where necessary by imposing administrative penalties and other administrative measures in accordance with the national laws adopted in addition to the implementation of provisions of Title VII, Chapter 1, Section IV, of Directive 2013/36/EU.; | 4. Members States shall ensure that where a credit institution does not comply with its obligations as a member of a DGS, that DGS shall immediately notify the competent authority of that credit institution thereof. Member States shall ensure that the competent authority, in cooperation with that DGS, uses the supervisory powers laid down in Directive 2013/36/EU, and promptly takes all measures to ensure that the credit institution concerned complies with its obligations, including where necessary by imposing penalties and other measures in accordance with the national laws adopted in addition to the implementation of provisions of Title VII, Chapter 1, Section IV, of Directive 2013/36/EU.’ |
The wording leaves room for interpretation regarding the tasks assigned to the (different types of) DGSs. We are in favour of maintaining the status quo at this point. In this respect, the wording should be sharpened, i.e. the word "administrative" needs to be deleted.
| Text proposed by the Commission | Amendment |
|---|---|
| 5. Member States shall ensure that the DGS informs the designated authority where the measures referred to in paragraphs 4 and 4a fail to restore compliance by the credit institution. Member States shall ensure that the designated authority assesses whether the institution still fulfils the conditions for a continued membership of the DGS and inform the competent authority of the outcome of that assessment. | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| 5. Member States shall ensure that the DGS informs the designated authority where the measures referred to in paragraphs 4 and 4a fail to restore compliance by the credit institution. Member States shall ensure that the designated authority assesses whether the institution still fulfils the conditions for a continued membership of the DGS and inform the competent authority of the outcome of that assessment. | 5. If the measures taken under paragraph 4 fail to secure compliance on the part of the credit institution, the DGS may, subject to national law and the express consent of the competent authorities, in the absence of other efficient alternatives and taking into account the nature and severity of the infringement, give not less than one month’s notice of its intention to exclude the credit institution from membership of the DGS. Deposits made before the expiry of that notice period shall continue to be fully covered by the DGS. If, on expiry of that notice period, the credit institution has not complied with its obligations, the DGS shall exclude the credit institution. |
The DGS would ultimately no longer be involved in the decision to exclude a credit institution, whereas it had been previously. The status quo should be maintained. The wording should specify that an exclusion should only be chosen as a last resort, taking into account the nature and severity of the infringement, and a (new) deadline set. Furthermore, the threat of exclusion including the setting of a deadline vis-à-vis the institution was deleted in this paragraph. In this respect, too, the previous regulation should be retained for reasons of proportionality.
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Member States shall ensure that where the competent authority decides to withdraw the authorisation in accordance with Article 18 of Directive 2013/36/EU, the credit institution ceases to be a member of the DGS. Member States shall ensure that deposits held on the date on which a credit institution ceased to be a member of the DGS continue to be covered by that DGS.; | 6. Member States shall ensure that where the competent authority decides to withdraw the authorisation in accordance with Article 18 of Directive 2013/36/EU, the credit institution ceases to be a member of the DGS. Member States shall ensure that deposits held on the date on which a credit institution ceased to be a member of the DGS continue to be covered by that DGS for a maximum period of six months. Member States shall ensure that depositors of a credit institution that ceased to be a member of the DGS are duly informed of the consequences thereof and can, without bearing any costs, transfer their deposits to another institution which is a member of the same DGS. ; |
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Member States shall ensure that where the competent authority decides to withdraw the authorisation in accordance with Article 18 of Directive 2013/36/EU, the credit institution ceases to be a member of the DGS. Member States shall ensure that deposits held on the date on which a credit institution ceased to be a member of the DGS continue to be covered by that DGS.; | 6. Member States shall ensure that where the competent authority decides to withdraw the authorisation in accordance with Article 18 of Directive 2013/36/EU, the credit institution ceases to be a member of the DGS. Member States shall ensure that deposits held on the date on which a credit institution ceased to be a member of the DGS continue to be covered by that DGS. Member States shall ensure that the credit institution provides the DGS with an single costumer view (SCV) as of the effective date of the withdrawal of the banking authorization without delay. |
It should be ensured that the SCV is provided immediately upon withdrawal of the banking authorization with data as of the date of withdrawal for reasons of follow-up liability.
| Text proposed by the Commission | Amendment |
|---|---|
| 13. By… [OP – please add 36 months after entry into force], the EBA shall develop guidelines on the scope, contents and procedures of the stress tests referred to in paragraph 10.’; | 13. By… [OP – please add 24 months after entry into force], the EBA shall develop draft regulatory technical standards on the scope, contents and procedures of the stress tests referred to in paragraph 10. |
| EBA shall submit those draft regulatory technical standards to the Commission by … [24 months after the date of entry into force of this amending Directive]. | |
| Power is delegated to the Commission to supplement this Directive by adopting the regulatory technical standards referred to in the first subparagraph of this paragraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010. ; |
| Text proposed by the Commission | Amendment |
|---|---|
| (iii) point (e) is deleted; | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| (iii) point (e) is deleted; | (iii) deleted |
It is not comprehensible why investment firms have been completely deleted from the catalogue of Art. 5 (1). With Reference to Recital 4 investment firms are not financial institutions within the meaning of the CRR Article 4 (26), (3) & (2).
| Text proposed by the Commission | Amendment |
|---|---|
| (v) point (j) is deleted; | deleted |
Deposits of public entities should not be protected because the idea of consumer protection and the avoidance of a "bank run" does not apply here.
| Text proposed by the Commission | Amendment |
|---|---|
| (v) point (j) is deleted; | (v) point (j) is replaced by the following: |
| ‘(j) deposits by central and regional governments’ ; |
In line with the overall objective to include in coverage some public sector entities which are not sophisticated depositors (such as schools, hospitals, some local services etc.), this amendment clarifies that central/regional governments should remain excluded from coverage. This would lower the risk to put part of the burden of sovereign risk on the DGS.
| Text proposed by the Commission | Amendment |
|---|---|
| (v) point (j) is deleted; | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| (va) the point (ka) is added: | |
| (ka) deposits by persons or legal entities subject to targeted financial sanctions adopted by the Union. |
| Present text | Amendment |
|---|---|
| (-a) paragraph 1 is replaced by the following: | |
| Member States shall ensure that the coverage level for the aggregate deposits of each depositor is EUR 100 000 in the event of deposits being unavailable. | "Member States shall ensure that the coverage level for the aggregate deposits of each depositor is EUR 200 000 in the event of deposits being unavailable. |
| " |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) deposits resulting from real estate transactions relating to private residential properties and deposits intended for such transactions, provided that those transactions are concluded in the short term by a natural person, and provided that that natural person can provide documents proving such transaction;; | (a) deposits resulting from real estate transactions relating to private residential properties and deposits intended for such transactions, provided that those transactions are concluded in a three months period by a natural person, and provided that that natural person can provide documents proving such transaction;; |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) deposits resulting from real estate transactions relating to private residential properties and deposits intended for such transactions, provided that those transactions are concluded in the short term by a natural person, and provided that that natural person can provide documents proving such transaction;; | (a) deposits resulting from real estate transactions relating to private residential properties and deposits intended for such transactions, provided that those transactions are concluded in a three months period by a natural person, and provided that that natural person can provide documents proving such transaction; |
Practical experience from the DGSs has shown that things like transfers (e.g. from current to call accounts), categories (e.g. only owner-occupied real estate), etc. and the phrase “in the short term” need to be specified in more detail (e.g. 3 months) here.
| Text proposed by the Commission | Amendment |
|---|---|
| In cases where interest rates on certain deposits significantly exceed the prevailing market interest rate, as determined and based on transparent and publicly available data, the DGS shall have the authority to adjust the reimbursed interest to reflect the prevailing market rate at the time of determination or ruling. This adjustment shall be made to prevent moral hazard. The criteria and methodology for defining 'significantly exceed' and for the adjustment, shall be established in a transparent manner, in accordance with guidelines developed by the European Banking Authority (EBA) and subject to the approval of the competent national authority. |
| Text proposed by the Commission | Amendment |
|---|---|
| (-a) the following subparagraphs 3a and 3b are added t: | |
| “Member States shall ensure that for specific deposits laid down in national law the coverage level referred to in Article 6(1) applies to each of the absolutely entitled persons referred to in the first subparagraph. By way of derogation from paragraph 1, when determining the repayable amount for an individual absolutely entitled person, the DGS shall not take into account the aggregate fund deposits placed by that person with the same credit institution. Member States shall ensure that DGSs repay covered deposits either to the depositor for the benefit of each absolutely entitled person, or to the absolutely entitled person directly.” |
In line with the proposed harmonisation of the regime for client funds deposits according Article 8b, it is suggested to introduce similar harmonised approach for other specific deposits such as deposits on accounts held by notaries, attorneys, real estate agencies, distrainers or insolvency administrators , which may in some aspects resemble the deposits made through a payment institution or e-money institution.
| Text proposed by the Commission | Amendment |
|---|---|
| 3. By way of derogation from paragraph 1, Member States shall allow DGSs to apply a longer repayment period for the deposits referred to in Article 6(2), Article 7(3) and Article 8b, which shall not exceed 20 working days from the date on which those DGSs received the complete documentation they requested from a depositor to examine the claims and verify that the conditions for repayment are met.; | 3. By way of derogation from paragraph 1, Member States shall allow DGSs to apply a longer repayment period for the deposits referred to in Article 6(2), Article 7(3) and Article 8b, which shall not exceed 20 working days from the date on which those DGSs received the complete documentation they requested from a depositor or, where appropriate, an account holder, to examine the claims and verify that the conditions for repayment are met. For the deposits referred to in Article 6(2) and Article 7(3), where DGSs are not able to make the repayable amount available in less than seven working days, they shall ensure that depositors have access to an appropriate amount of their covered deposits to cover living costs within five working days of making a request for that amount. ; |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. By way of derogation from paragraph 1, Member States shall allow DGSs to apply a longer repayment period for the deposits referred to in Article 6(2), Article 7(3) and Article 8b, which shall not exceed 20 working days from the date on which those DGSs received the complete documentation they requested from a depositor to examine the claims and verify that the conditions for repayment are met.; | 3. By way of derogation from paragraph 1, Member States shall allow DGSs to apply a longer period for repaying the deposits referred to in Article 6(2), Article 7(3) and Article 8b, which shall not exceed 20 working days from the date on which those DGSs received the complete documentation they requested from a depositor to examine the claims and verify that the conditions for repayment are met.; |
| Text proposed by the Commission | Amendment |
|---|---|
| 9. Member States shall ensure that where there has been no transaction relating to the deposit during the last 24 months, DGSs may set a threshold concerning the administrative costs that would be incurred by those DGSs in making such a repayment. DGSs shall not be obliged to take active steps to repay depositors below that threshold. Member States shall ensure that DGSs repay depositors below that threshold where so requested by those depositors.’; | 9. Member States shall ensure that where there has been no transaction relating to the deposit during the last 24 months, or the balance of the deposit account is low, DGSs may set a threshold concerning the administrative costs that would be incurred by those DGSs in making such a repayment. DGSs shall not be obliged to take active steps to repay depositors below that threshold. Member States shall ensure that DGSs repay depositors below that threshold where so requested by those depositors.’; |
| Text proposed by the Commission | Amendment |
|---|---|
| (c) the clients referred to in point (a) are identified or identifiable prior to the date on which a relevant administrative authority makes a determination as referred to in Article 2(1), point (8)(a) or a judicial authority makes a ruling as referred to in Article 2(1), point (8)(b). | (c) the clients referred to in point (a) are identified or identifiable, under the ultimate responsibility of the entity holding the account on behalf of clients, prior to the date on which a relevant administrative authority makes a determination as referred to in Article 2(1), point (8)(a) or a judicial authority makes a ruling as referred to in Article 2(1), point (8)(b). |
| Text proposed by the Commission | Amendment |
|---|---|
| 1a. In addition to paragraph 1, Member States shall ensure that the client fund deposits in accounts held by crypto-asset service providers authorized in accordance with Article 63 Regulation (EU) 2023/1114, crowdfunding service providers and credit servicers that meet the conditions laid down in paragraph 1, point (a) and (c) of this Article are covered by the DGSs. |
In line with the proposed harmonisation of the regime for client funds deposits according Article 8b, it is suggested to introduce similar harmonised approach for other specific deposits such as deposits on accounts held by crypto-asset service providers, crowdfunding service providers or credit servicers, which may in some aspects resemble the deposits made through a payment institution or e-money institution.
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Member States shall ensure that the coverage level referred to in Article 6(1) applies to each of the clients that meet the conditions laid down in paragraph 1, point (c), of this Article. By way of derogation from Article 7(1), when determining the repayable amount for an individual client, the DGS shall not take into account the aggregate fund deposits placed by that client with the same credit institution. | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that DGSs repay covered deposits either to the account holder for the benefit of each client, or to the client directly. | 3. Member States shall ensure that DGSs repayment of covered deposits is made either to the account holder for the benefit of each client, or to the client directly. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Without prejudice to rights they may have under national law, DGSs that make payments under guarantee within a national framework shall have the right of subrogation to the rights of depositors in winding up or reorganisation proceedings for an amount equal to the DGSs payments made to depositors. DGSs that make a contribution in the context of the resolution tools referred to in Article 37(3), point (a) or (b), of Directive 2014/59/EU, or in the context of measures taken in accordance with Article 11(5) of this Directive, shall have a claim against the residual credit institution for any loss incurred as a result of any contributions made to resolution pursuant to Article 109 of Directive 2014/59/EU or to the transfer made pursuant to Article 11(5) of this Directive in connection to losses which depositors otherwise would have borne. That claim shall rank at the same level as deposits under national law governing normal insolvency proceedings. | 2. Without prejudice to rights they may have under national law, DGSs that make payments under guarantee within a national framework shall have the right of subrogation to the rights of depositors in winding up or reorganisation proceedings for an amount equal to the DGSs payments made to depositors. DGSs that make a contribution in the context of the resolution tools referred to in Article 37(3), point (a) or (b), of Directive 2014/59/EU, or in the context of measures taken in accordance with Article 11(5) of this Directive, shall have a claim against the residual credit institution for any loss incurred as a result of any contributions made to resolution pursuant to Article 109 of Directive 2014/59/EU or to the transfer made pursuant to Article 11(5) of this Directive in connection to losses which depositors otherwise would have borne. That claim shall rank at the same level as covered deposits under national law governing normal insolvency proceedings. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Without prejudice to rights they may have under national law, DGSs that make payments under guarantee within a national framework shall have the right of subrogation to the rights of depositors in winding up or reorganisation proceedings for an amount equal to the DGSs payments made to depositors. DGSs that make a contribution in the context of the resolution tools referred to in Article 37(3), point (a) or (b), of Directive 2014/59/EU, or in the context of measures taken in accordance with Article 11(5) of this Directive, shall have a claim against the residual credit institution for any loss incurred as a result of any contributions made to resolution pursuant to Article 109 of Directive 2014/59/EU or to the transfer made pursuant to Article 11(5) of this Directive in connection to losses which depositors otherwise would have borne. That claim shall rank at the same level as deposits under national law governing normal insolvency proceedings. | 2. Without prejudice to rights they may have under national law, DGSs that make payments under guarantee within a national framework shall have the right of subrogation to the rights of depositors in winding up or reorganisation proceedings for an amount equal to the DGSs payments made to depositors. DGSs that make a contribution in the context of the resolution tools referred to in Article 37(3), point (a) or (b), of Directive 2014/59/EU, or in the context of measures taken in accordance with Article 11(5) of this Directive, shall have a claim against the residual credit institution for any loss incurred as a result of any contributions made to resolution pursuant to Article 109 of Directive 2014/59/EU or to the transfer made pursuant to Article 11(5) of this Directive in connection to losses which depositors otherwise would have borne. That claim shall rank at the same level as covered deposits under national law governing normal insolvency proceedings. |
This adaptation follows from the rejection of a single tiered depositor preference. The claim against the residual institution for a DGS should be preferred.
| Present text | Amendment |
|---|---|
| (-i) the first subparagraph is replaced by the following: | |
| 2. Member States shall ensure that, by 3 July 2024, the available financial means of a DGS shall at least reach a target level of 0,8 % of the amount of the covered deposits of its members. | "2. Member States shall ensure that, by ... [18 months after the date of entry into force of this amending Directive], the available financial means of a DGS shall at least reach and maintain a target level 0,8% of the amount of the covered deposits of its members." |
| Present text | Amendment (-i) the first subparagraph is replaced by the following: |
|---|---|
| 2. Member States shall ensure that, by 3 July 2024, the available financial means of a DGS shall at least reach a target level of 0,8 % of the amount of the covered deposits of its members. | 2. Member States shall ensure that, by ... [18 months after the date of entry into force of this amending Directive], the available financial means of a DGS shall at least reach and maintain a target level 0,8% of the amount of the covered deposits of its members. |
| Text proposed by the Commission | Amendment |
|---|---|
| (i) after the first subparagraph, the following subparagraphs are inserted: | deleted |
| ‘ | |
| For the calculation of the target level referred to in the first subparagraph, the reference period shall be between 31 December preceding the date by which the target level is to be reached and that date. | |
| When determining whether the DGS has reached that target level, Member States shall only take into account available financial means directly contributed by, or recovered from, members to the DGS, net of administrative fees and charges. Those available financial means shall include investment income derived from funds contributed by members to the DGS, but shall exclude repayments not claimed by eligible depositors during payout procedures, and loans between DGSs.; | |
| ’ |
| Text proposed by the Commission | Amendment |
|---|---|
| When determining whether the DGS has reached that target level, Member States shall only take into account available financial means directly contributed by, or recovered from, members to the DGS, net of administrative fees and charges. Those available financial means shall include investment income derived from funds contributed by members to the DGS, but shall exclude repayments not claimed by eligible depositors during payout procedures, and loans between DGSs.; | When determining whether the DGS has reached that target level, Member States shall only take into account available financial means directly contributed by, or recovered from, members to the DGS, net of administrative fees and charges. Those available financial means shall include investment income derived from funds contributed by members to the DGS, but shall exclude repayments not claimed by eligible depositors during payout procedures, and loans between DGSs, any debt liabilities due by the DGS, including loans from other DGSs and alternative funding arrangement referred to in Article 10(9).; |
Support for the Commission proposal that the available financial means that count toward the target level shall be limited to funds stemming from contributions, and exclude all borrowings made by the DGS. However, loans made to another DGS shall still count towards the target level (as long as the loan is financed by funds stemming from contributions). This treatment would ensure consistency with the current treatment of loans between resolution funds (see article 10(6) BRRD) and foster loans between DGSs. Keeping the current Commission proposal would push DGSs to avoid lending to other DGSs, at some point depriving art. 12 DGSD of any effects, while going backwards regarding the objective of liquidity support between DGSs.
| Text proposed by the Commission | Amendment |
|---|---|
| When determining whether the DGS has reached that target level, Member States shall only take into account available financial means directly contributed by, or recovered from, members to the DGS, net of administrative fees and charges. Those available financial means shall include investment income derived from funds contributed by members to the DGS, but shall exclude repayments not claimed by eligible depositors during payout procedures, and loans between DGSs.; | When determining whether the DGS has reached that target level, Member States shall only take into account available financial means directly contributed by, or recovered from, members to the DGS, net of administrative fees and charges. Those available financial means shall include investment income derived from funds contributed by members to the DGS, but shall exclude repayments not claimed by eligible depositors during payout procedures, and loans, including between DGSs.; |
| Text proposed by the Commission | Amendment |
|---|---|
| An outstanding loan to another DGS under Article 12 shall be treated as an asset of the DGS which provided the loan and may be counted towards that DGS’s target level.’; |
Support for the proposal that the available financial means that count toward the target level shall be limited to funds stemming from contributions, and exclude all borrowings made by the DGS. However, loans made to another DGS shall still count towards the target level (as long as the loan is financed by funds stemming from contributions). This treatment would ensure consistency with the current treatment of loans between resolution funds (see article 106(6) BRRD) and foster loans between DGSs. Keeping the current Commission proposal would push DGSs to avoid lending to other DGSs, at some point depriving art. 12 DGSD of any effects, while going backwards regarding the objective of liquidity support between DGSs.
| Text proposed by the Commission | Amendment |
|---|---|
| Where, after the target level referred to in the first subparagraph has been reached for the first time and the available financial means, following a disbursement of DGS’s funds in accordance with Article 8(1), and Article 11(2), (3), and (5), have been reduced to less than two-thirds of the target level, DGSs shall set the regular contribution at a level allowing for the target level to be reached within 6 years.; | Where, after the target level referred to in the first subparagraph has been reached for the first time and the available financial means, following a disbursement of DGS’s funds in accordance with Article 8(1), and Article 11(2), (3), and (5), have been reduced to less than two-thirds of the target level, DGSs shall set the regular contribution at a level allowing for the target level to be reached within 6 years. Where it has been reduced but remained higher than the two-thirds of the target level, DGSs shall set the regular contribution at a level allowing for the target level to be reached within 3 years.; |
| Present text | Amendment |
|---|---|
| (ca) paragraph 6, points a and b are replaced by the following: | |
| (a) the reduction is based on the assumption that it is unlikely that a significant share of available financial means will be used for measures to protect covered depositors, other than as provided for in Article 11(2) and (6); and | “(a) the reduction is applicable at the single DGS level and is based on the assumption that it is unlikely that a significant share of available financial means will be used for measures to protect covered depositors, other than as provided for in Article 11(2) and (6); and |
| (b) the banking sector in which the credit institutions affiliated to the DGS operate is highly concentrated with a large quantity of assets held by a small number of credit institutions or banking groups, subject to supervision on a consolidated basis which, given their size, are likely in case of failure to be subject to resolution proceedings. | (b) the banking sector which is composed of credit institutions affiliated to the DGS is highly concentrated with a large quantity of assets held by a small number of credit institutions or banking groups, subject to supervision on a consolidated basis which, given their size, are likely in case of failure to be subject to resolution proceedings.” |
The amendment is aimed at clarifying that the assessment of the conditions for the approval of a target level reduction is to be carried out at the DGS level rather than at the Member State level, taking into account that in a Member State may exist more than one DGS. The interpretation of the legal provision must be more clearly consistent with its economic and financial rationale, since the level at which the deposit insurance risk is generated and managed is undoubtedly at the DGS level. No risk-sharing between DGSs is envisaged by current framework.
| Text proposed by the Commission | Amendment |
|---|---|
| 7. Member State shall ensure that DGSs, designated authorities, or competent authorities set the investment strategy for the available financial means of DGSs, and that that investment strategy complies with the principle of diversification and investments in low-risk assets.; | 7. Member State shall ensure that DGSs, designated authorities, or competent authorities set the investment strategy for the available financial means of DGSs, and that that investment strategy complies with the principle of diversification and investments in low-risk and liquid assets. |
| Member States shall ensure that the investment strategy referred to in the first sub-paragraph complies with the principles laid down in Articles 4, 8 and 10 of Commission Delegated Regulation (EU) 2016/451. ; |
| Text proposed by the Commission | Amendment |
|---|---|
| 7. Member State shall ensure that DGSs, designated authorities, or competent authorities set the investment strategy for the available financial means of DGSs, and that that investment strategy complies with the principle of diversification and investments in low-risk assets.; | 7. Member State shall ensure that DGSs, designated authorities, or competent authorities set the investment strategy for the available financial means of DGSs, and that that investment strategy complies with the principle of diversification and investments in low-risk assets and provides liquidity necessary for a DGS to fulfil its role.; |
| Text proposed by the Commission | Amendment |
|---|---|
| 7a. Member States shall ensure that DGSs may place all or part of their available financial means with their national central bank or national treasury, provided that those available financial means are kept on a segregated account and that they are readily available for use by the DGS in accordance with Articles 11 and 12.; | 7a. Member States shall ensure that DGSs may place all or part of their available financial means with their national central bank or national treasury, provided that it is a cost effective decision for DGS and those available financial means are kept on a segregated account and that they are readily available for use by the DGS in accordance with Articles 11 and 12.’; |
| Present text | Amendment |
|---|---|
| (ea) paragraph 9 is replaced by the following: | |
| 9. Member States shall ensure that DGSs have in place adequate alternative funding arrangements to enable them to obtain short-term funding to meet claims against those DGSs. | " 9. It is confirmed that Member States shall ensure that DGSs have in place adequate alternative funding arrangements to enable them to obtain short-term funding to meet claims against those DGSs." |
| Present text | Amendment |
|---|---|
| (ea) paragraph 9 is replaced by the following: | |
| 9. Member States shall ensure that DGSs have in place adequate alternative funding arrangements to enable them to obtain short-term funding to meet claims against those DGSs. | "9. It is confirmed that Member States shall ensure that DGSs have in place adequate alternative funding arrangements to enable them to obtain short-term funding to meet claims against those DGSs." |
| Text proposed by the Commission | Amendment |
|---|---|
| 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9) which are not financed through public funds, before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort. | 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9) which are not financed through public funds, before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort, after all other options have been exhausted. |
| Text proposed by the Commission | Amendment |
|---|---|
| 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9) which are not financed through public funds, before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort. | 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9) which are not financed through public funds, before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort and are cost effective. |
| Text proposed by the Commission | Amendment |
|---|---|
| 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9) which are not financed through public funds, before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort. | 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9), before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort. |
| Text proposed by the Commission | Amendment |
|---|---|
| 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9) which are not financed through public funds, before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort. | 11. Member States shall ensure that in the context of the measures referred to in Article 11(1), (2), (3) and (5), DGSs may use the funds originating from the alternative funding arrangements referred to in Article 10(9), before using the available financial means and before collecting the extraordinary contributions referred to in Article 10(8). Member States shall ensure that DGSs use alternative funding arrangements financed through public funds only as a last resort. |
| Text proposed by the Commission | Amendment |
|---|---|
| 12. The EBA shall develop draft regulatory technical standards to specify: | deleted |
| (a) the methodology for the calculation of available financial means qualifying for the target level referred to in paragraph 2, including the delineation of the available financial means of DGSs and the categories of available financial means that derive from contributed funds; | |
| (b) the details of the process to reach the target level referred to in paragraph 2 after a DGS has used available financial means in accordance with Article 11. | |
| EBA shall submit those draft regulatory technical standards to the Commission by … [OP – please insert the date = 24 months after the date of entry into force of this Directive]. | |
| Power is delegated to the Commission to supplement this Directive by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010. |
The methodology to calculate the available financial means that count towards the target level is important to (i) determine whether DGSs shall levy new contributions or not and (ii) ensure DGSs are sufficiently funded ex-ante, consistent with the purpose of the directive. Also, “available financial means” are defined in article 2, there is no need to mandate the EBA to “delineate” them. Additionally the proposed paragraph 2 already states that available financial means that derive from contributed funds are the only one counting towards the target level (and it should be clarified that that debt does not count toward the target level). The proposed paragraph 2 also clarifies the process to reach the target level after a DGS has used available financial means. Should these clarifications be insufficient, the directive itself should be further clarified, without delegating essential elements to the EBA.
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that DGSs use the available financial means referred to in Article 10 primarily to repay depositors in accordance with Article 8 without prejudice to the use of additional financial means collected by DGSs for the fulfilment of mandates other than depositor protection under this Directive. | 1. Member States shall ensure that DGSs use the available financial means referred to in Article 10 primarily to secure repayments to depositors in accordance with Article 8 without prejudice to the use of additional financial means collected by DGSs for the fulfilment of mandates other than depositor protection under this Directive. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that DGSs use the available financial means referred to in Article 10 primarily to repay depositors in accordance with Article 8 without prejudice to the use of additional financial means collected by DGSs for the fulfilment of mandates other than depositor protection under this Directive. | 1. Member States shall ensure that DGSs use the available financial means referred to in Article 10 primarily to repay depositors in accordance with Article 8 without prejudice to the use of these financial means collected by DGSs for the fulfilment of mandates other than depositor protection under this Directive. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that DGSs use the available financial means referred to in Article 10 primarily to repay depositors in accordance with Article 8 without prejudice to the use of additional financial means collected by DGSs for the fulfilment of mandates other than depositor protection under this Directive. | 1. Member States shall ensure that DGSs use the available financial means referred to in Article 10 primarily to repay depositors in accordance with Article 8 without prejudice to the use of these financial means collected by DGSs for the fulfilment of mandates other than depositor protection under this Directive. |
Up to now, financing of IPSs preventive measures has been permitted within certain limits from the available financial means, since the need for depositor reimbursement is averted in the case of an IPS, and this type of use of funds is therefore especially economic on funds. In addition, IPSs are subject to the strict supervisory regulations of CRR Art. 113 (7) anyway, so that effective control is also provided. This must be kept in any DGSD review. But due to the restrictions set out in the DGSD draft, preventive measures could de-facto no longer be financed from the officially recognised deposit guarantee funds (i.e. from the “available financial means”) after implementing the directive, but would require additional financial resources. Such a financial burden would have to be financed by the member banks - and thus ultimately by their customers - and would thus create a competitive disadvantage. This is neither in line with the goal of financial stability nor with the Eurogroup Statement of June 2022.
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Member States shall ensure that DGSs use the available financial means to finance the resolution of credit institutions in accordance with Article 109 of Directive 2014/59/EU. Member States shall ensure that resolution authorities determine the amount that a DGS is to contribute to the financing of resolution of credit institutions, after those resolution authorities have consulted the DGS on the results of the least cost test referred to in Article 11e of this Directive. | 2. Member States shall ensure that DGSs use the available financial means to finance the resolution of credit institutions in accordance with Article 109 of Directive 2014/59/EU. |
In relation to Art. 11 (2), the change to the proposal suggested here bases on the corresponding proposed changes to Art. 109 BRRD. These imply an extension of Deposit Guarantee Schemes' co-financing of resolution measures, which is likely to strain Deposit Guarantee Schemes financially. As this idea causes serious threats to financial stability in the end the Commission's proposal relating to Art. 109 BRRD and in consequence also to Art. 11 (2) must be rejected in their entirety.
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Member States shall ensure that DGSs use the available financial means to finance the resolution of credit institutions in accordance with Article 109 of Directive 2014/59/EU. Member States shall ensure that resolution authorities determine the amount that a DGS is to contribute to the financing of resolution of credit institutions, after those resolution authorities have consulted the DGS on the results of the least cost test referred to in Article 11e of this Directive. | 2. Member States shall ensure that DGSs use the available financial means to finance the resolution of credit institutions in accordance with Article 109 of Directive 2014/59/EU. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Member States shall ensure that DGSs use the available financial means to finance the resolution of credit institutions in accordance with Article 109 of Directive 2014/59/EU. Member States shall ensure that resolution authorities determine the amount that a DGS is to contribute to the financing of resolution of credit institutions, after those resolution authorities have consulted the DGS on the results of the least cost test referred to in Article 11e of this Directive. | 2. Member States shall ensure that DGSs use the available financial means to finance the resolution of credit institutions in accordance with Article 109 of Directive 2014/59/EU. Member States shall ensure that resolution authorities determine the amount that a DGS is to contribute to the financing of resolution of credit institutions, after those resolution authorities have consulted the DGS on the results of the least cost test referred to in Article 11e of this Directive. Member States shall ensure that DGSs respond, without delay, to such consultation. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States may allow DGSs to use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: | 3. Notwithstanding paragraph 3a, Member States may allow DGSs to use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States may allow DGSs to use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: | 3. Member States shall ensure that a DGS may use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States may allow DGSs to use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: | 3. Member States shall ensure that DGSs can use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States may allow DGSs to use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: | 3. Member States shall ensure that DGSs can use the available financial means for preventive measures as referred to in Article 11a for the benefit of a credit institution where all of the following applies: |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) none of the circumstances referred to in Article 32(4) of Directive 2014/59/EU are present; | (a) the competent authority has confirmed that none of the circumstances referred to in Article 32(4) of Directive 2014/59/EU are present; |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) none of the circumstances referred to in Article 32(4) of Directive 2014/59/EU are present; | (a) the resolution authority has not taken any resolution action under Article 32 of Directive 2014/59/EU; |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) none of the circumstances referred to in Article 32(4) of Directive 2014/59/EU are present; | (a) the resolution authority has not taken any resolution action under Article 32 of Directive 2014/59/EU. |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) none of the circumstances referred to in Article 32(4) of Directive 2014/59/EU are present; | (a) the resolution authority has not taken any resolution action under Article 32 of Directive 2014/59/EU; |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) none of the circumstances referred to in Article 32(4) of Directive 2014/59/EU are present; | (a) the resolution authority has not taken any resolution action under Article 32 of Directive 2014/59/EU; |
The Commission's proposal to amend Art. 11 (3) point (a) reads as if any preventive measure based on available financial means is only permitted as long as the institution is not yet objectively in a status of FOLTF according to Art. 32 (4) BRRD. This would, however, imply a significant hindrance of measures by DGS even though such measures are an important safeguard to the resolution objectives set out in Art. 31 BRRD. We understand that this effect was not intended by the European Commission; hence, the proposal needs to be changed correspondingly. The proposed amendment on the Least Cost Test is the logical consequence on our amendments for Article 11e.
| Text proposed by the Commission | Amendment |
|---|---|
| (aa) the DGS has confirmed that the intervention is necessary to preserve financial soundness and long-term viability of the credit institution; |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the DGS has confirmed that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e; | (b) the DGS has confirmed that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e or any other measure that would be considered equivalent to repaying depositors; |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the DGS has confirmed that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e; | (b) the DGS has confirmed that the cost of the measure meets the provisions for a Least Cost Test in accordance with Article 11e; |
| Text proposed by the Commission | Amendment |
|---|---|
| (ca) the credit institution has not benefitted in the last ten years from any extraordinary public financial support measures as defined in Article 32c of Directive 2014/59/EU, including DGSs preventive measures. |
To avoid non-viable banks benefiting from multiple and periodic aid enabling them to stay on the market and circumvent resolution, a stringent “one time last time” principle should be established. Also, DGS funds should primarily be used for its harmonized uses (payout and resolution), hence be better protected through the use of additional funds or ex-post contributions for other uses.
| Text proposed by the Commission | Amendment |
|---|---|
| 3a. Member States may allow IPSs which are officially recognised as a DGS according to Article 4(2) to use the available financial means for preventive measures for the benefit of a credit institution where: | |
| (a) the resolution authority has not taken any resolution action under Article 32 of Directive 2014/59/EU; | |
| (b) the DGS is a system certified according to Article 133(7) of Regulation (EU) No 575/2013; | |
| (c) all of the conditions laid down in Articles 11f are met. |
Recognises the special role of IPS: IPSs use preventive measures as a mean to prevent the compensation case and thus to ensure deposit protection. For them preventive measures are the standard case, not one of several possible instruments of a tool box selection.
| Text proposed by the Commission | Amendment |
|---|---|
| (a) the need to repay depositors arises and the available financial means of the DGS amount to less than two-thirds of the target level; | (a) the need to repay depositors or to intervene in resolution arises and the available financial means of the DGS amount to less than two-thirds of the target level; |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the available financial means of the DGS fall below 25 % of the target level. | (b) the available financial means of the DGS fall below 62,5 % of the target level. |
To avoid non-viable banks benefiting from multiple and periodic aid enabling them to stay on the market and circumvent resolution, a stringent “one time last time” principle should be established. Also, DGS funds should primarily be used for its harmonized uses (payout and resolution), hence be better protected through the use of additional funds or ex-post contributions for other uses.
| Text proposed by the Commission | Amendment |
|---|---|
| 5. Where a credit institution is wound up in accordance with Article 32b of Directive 2014/59/EU in order to exit the market or terminate its banking activity, Member States may allow DGSs to use the available financial means for alternative measures to preserve the access of depositors to their deposits, including the transfer of assets and liabilities and a deposit book transfer, provided that the DGS confirms that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e of this Directive and that all the conditions laid down in Article 11d of this Directive are met.’; | 5. Where a credit institution is wound up in accordance with Article 32b of Directive 2014/59/EU in order to exit the market or terminate its banking activity, Member States may allow DGSs to use the available financial means for alternative measures to preserve the access of depositors to their deposits, including the transfer of assets and liabilities and a deposit book transfer, where all of the following applies : |
| (a) the DGS confirms that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e of this Directive; | |
| (b) all the conditions laid down in Article 11d of this Directive are met; | |
| (c) the measure was envisaged in the resolution plan defined in articles 10 and 12 of the Directive 2014/59/EU; | |
| (d) should the measure take the form of a transfer of assets or liabilities, the transferred liabilities take the form of: | |
| (i) covered deposits; | |
| (ii) eligible deposits from natural persons and micro, small and medium-sized enterprises; | |
| (iii) deposits that would be eligible deposits from natural persons and micro, small and medium-sized enterprises were they not made through branches located outside the Union of institutions established within the Union; | |
| (iv) any liabilities that ranked senior to covered deposits in the national creditor hierarchy of claims in insolvency. |
The least cost test is not a sufficient safeguard to ensure that alternative measures will not be able to circumvent resolution when the resolution is based on transfer strategies. Since DGS alternative measures and transfer strategies in resolution have the same economic outcomes, they should be subject to similar economic conditions, in particular in relation to (i) market exit; (ii) preliminary burden sharing (limitation in terms of seniority of liabilities that could be transferred); (iii) sufficient internal loss absorption capacity. In order to protect available financial means of the DGS and thus ensure that DGS would be able to perform a payout in case needed, a cap should be reintroduced in terms of use of available financial means (50%, as in the current BRRD/DGSD) should the DGS be used for resolution/preventive/ alternative measures.
| Text proposed by the Commission | Amendment |
|---|---|
| 5. Where a credit institution is wound up in accordance with Article 32b of Directive 2014/59/EU in order to exit the market or terminate its banking activity, Member States may allow DGSs to use the available financial means for alternative measures to preserve the access of depositors to their deposits, including the transfer of assets and liabilities and a deposit book transfer, provided that the DGS confirms that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e of this Directive and that all the conditions laid down in Article 11d of this Directive are met.’; | 5. Where a credit institution is wound up in accordance with Article 32b of Directive 2014/59/EU in order to exit the market or terminate its banking activity, Member States shall ensure that DGSs can use the available financial means for alternative measures to preserve the access of depositors to their deposits, including the transfer of assets and liabilities and a deposit book transfer, provided that the DGS confirms that the cost of the measure does not exceed the cost of repaying.’; |
| Text proposed by the Commission | Amendment |
|---|---|
| 5. Where a credit institution is wound up in accordance with Article 32b of Directive 2014/59/EU in order to exit the market or terminate its banking activity, Member States may allow DGSs to use the available financial means for alternative measures to preserve the access of depositors to their deposits, including the transfer of assets and liabilities and a deposit book transfer, provided that the DGS confirms that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e of this Directive and that all the conditions laid down in Article 11d of this Directive are met.’; | 5. Where a credit institution is wound up in accordance with Article 32b of Directive 2014/59/EU in order to exit the market or terminate its banking activity, Member States shall ensure that a DGS may to use the available financial means for alternative measures to preserve the access of depositors to their deposits, including the transfer of assets and liabilities and a deposit book transfer, provided that the DGS confirms that the cost of the measure does not exceed the cost of repaying depositors as calculated in accordance with Article 11e of this Directive and that all the conditions laid down in Article 11d of this Directive are met.’; |
| Text proposed by the Commission | Amendment |
|---|---|
| 5a. Member States shall ensure that where DGSs perform measures as referred to in paragraphs (2), (3) and (5) of this article, the available financial means disbursed should be limited to 50% of their target level pursuant to Article 10. |
The least cost test is not a sufficient safeguard to ensure that alternative measures will not be able to circumvent resolution when the resolution is based on transfer strategies. Since DGS alternative measures and transfer strategies in resolution have the same economic outcomes, they should be subject to similar economic conditions, in particular in relation to (i) market exit; (ii) preliminary burden sharing (limitation in terms of seniority of liabilities that could be transferred); (iii) sufficient internal loss absorption capacity. In order to protect available financial means of the DGS and thus ensure that DGS would be able to perform a payout in case needed, a cap should be reintroduced in terms of use of available financial means (50%, as in the current BRRD/DGSD) should the DGS be used for resolution/preventive/ alternative measures.
| Text proposed by the Commission | Amendment |
|---|---|
| (13) the following Articles 11a to 11e are inserted: | (13) the following Articles 11a to 11f are inserted: |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Where Member States allow the use of DGS funds for preventive measures as referred to in Article 11(3), Member States shall ensure that DGSs use the available financial means for the preventive measures referred to in Article 11(3), provided that all of the following conditions are met: | 1. Member States shall ensure that DGSs use the available financial means for the preventive measures referred to in Article 11(3), provided that all of the following conditions are met: |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Where Member States allow the use of DGS funds for preventive measures as referred to in Article 11(3), Member States shall ensure that DGSs use the available financial means for the preventive measures referred to in Article 11(3), provided that all of the following conditions are met: | 1. Member States shall ensure that the designated authorities, after consulting the competent authorities and the resolution authorities, approve in a timely manner the use of the available financial means of DGSs use the available financial means for the preventive measures referred to in Article 11(3), provided that all of the following conditions are met: |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Where Member States allow the use of DGS funds for preventive measures as referred to in Article 11(3), Member States shall ensure that DGSs use the available financial means for the preventive measures referred to in Article 11(3), provided that all of the following conditions are met: | 1. Member States shall ensure that DGSs use the available financial means for the preventive measures referred to in Article 11(3), provided that all of the following conditions are met: |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Where Member States allow the use of DGS funds for preventive measures as referred to in Article 11(3), Member States shall ensure that DGSs use the available financial means for the preventive measures referred to in Article 11(3), provided that all of the following conditions are met: | 1. Member States shall ensure that the designated authorities, after consulting the competent authorities and the resolution authorities, approve in a timely manner the use of the available financial means of DGSs for the preventive measures referred to in Article 11(3) , provided that all of the following conditions are met: |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) the request of a credit institution for the financing of such preventive measures is accompanied by a note containing measures as referred to in Article 11b; | (a) the request of a credit institution for the financing of such preventive measures is accompanied by a note committing to a restructuring plan to ensure or restore long-term viability and compliance with the supervisory requirements applicable to the institution concerned in accordance with Directive 2013/36/EU and Regulation (EU) No 575/2013, containing measures as referred to in Article 11b and approved by the competent authority; |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| (a) the request of a credit institution for the financing of such preventive measures is accompanied by a note containing measures as referred to in Article 11b; | (a) the request of a credit institution for the financing of such preventive measures is accompanied by a note committing to a restructuring plan to ensure or restore long-term viability and compliance with the supervisory requirements applicable to the institution concerned in accordance with Directive 2013/36/EU and Regulation (EU) No 575/2013, containing measures as referred to in Article 11b ; |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) the request of a credit institution for the financing of such preventive measures is accompanied by a note containing measures as referred to in Article 11b; | (a) the request of a credit institution for the financing of such preventive measures is accompanied by a note containing measures as referred to in Article 11b paragraphs (1) to (5) or the credit institute is required by the DGS to prepare and submit a comprehensive restructuring concept within a reasonable period of time as referred to in Article 11b paragraph (7); |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the credit institution has consulted the competent authority on the measures envisaged in the note referred to in Article 11b; | deleted |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the credit institution has consulted the competent authority on the measures envisaged in the note referred to in Article 11b; | (b) the competent authority has assessed the measures envisaged in the note referred in Article 11b and confirmed that the measures are necessary to secure the financial soundness and the long-term viability of the credit institution; |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the credit institution has consulted the competent authority on the measures envisaged in the note referred to in Article 11b; | (b) the credit institution or the DGS has consulted the competent authority on the measures envisaged in the note referred to in Article 11b (1) to (5); |
| Text proposed by the Commission | Amendment |
|---|---|
| (c) the use of preventive measures by the DGS is linked to conditions imposed on the supported credit institution, involving at least more stringent risk monitoring of the credit institution and greater verification rights for the DGS; | (c) the use of preventive measures by the DGS is linked to conditions imposed on the supported credit institution, involving at least more stringent risk monitoring of the credit institution with corresponding governance arrangements for monitoring and greater verification rights for the DGS and national competent authorities; |
| Text proposed by the Commission | Amendment |
|---|---|
| (d) the use of the preventive measures by the DGS is conditional upon the credit institution’s commitments to secure access to covered deposits; | (d) the use of the preventive measures by the DGS is conditional upon the depositors' effective access to covered deposits; |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| (f) the credit institution complies with its obligations under this Directive and has fully reimbursed any previous preventive measure. | (f) the credit institution complies with its obligations under this Directive, has not already been subject to a preventive measure in the last 5 years and has fully reimbursed any other previous extraordinary financial support received in the last 10 years. |
| Text proposed by the Commission | Amendment |
|---|---|
| (f) the credit institution complies with its obligations under this Directive and has fully reimbursed any previous preventive measure. | (f) the credit institution complies with its obligations under this Directive, has not already been subject to a preventive measure in the past, and has fully reimbursed any other previous extraordinary financial support received in the last 10 years; |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| (f) the credit institution complies with its obligations under this Directive and has fully reimbursed any previous preventive measure. | (f) the credit institution complies with its obligations under this Directive; |
| Text proposed by the Commission | Amendment |
|---|---|
| (f) the credit institution complies with its obligations under this Directive and has fully reimbursed any previous preventive measure. | (f) the credit institution complies with its obligations under this Directive. |
| Text proposed by the Commission | Amendment |
|---|---|
| (fa) The envisaged amount of support does not exceed 50% of the deposit guarantee schemes’ available financial means; |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| (fa) the measures are confined to solvent institutions or entities, as confirmed by the competent authority; |
| Text proposed by the Commission | Amendment |
|---|---|
| (fb) the measures are not used to offset losses that the institution or entity has incurred or is likely to incur in the near future. |
| Text proposed by the Commission | Amendment |
|---|---|
| (fb) the measures are confined to solvent institutions or entities, as confirmed by the competent authority; |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| (fc) the measures are of a precautionary and temporary nature and are based on a pre-defined exit strategy approved by the competent authority, including a clearly specified termination date, sale date or repayment schedule for any of the measures provided; |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| (fd) the measures are not used to offset losses that the institution or entity has incurred or is likely to incur in the near future. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| 1a. For the purposes of the first subparagraph, point (fb), an institution or entity shall be deemed to be solvent where the competent authority has concluded that no breach has occurred, or is likely to occur in the 12 following months, of any of the requirements referred to in Article 92(1) of Regulation (EU) No 575/2013, Article 104a of Directive 2013/36/EU, Article 11(1) of Regulation (EU) 2019/2033, Article 40 of Directive (EU) 2019/2034 or the relevant applicable requirements under Union or national law. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| 1a. For the purposes of the first subparagraph, point (fa), an institution or entity shall be deemed to be solvent where the competent authority has concluded that no breach has occurred, or is likely to occur in the 12 following months, of any of the requirements referred to in Article 92(1) of Regulation (EU) No 575/2013, Article 104a of Directive 2013/36/EU, Article 11(1) of Regulation (EU) 2019/2033, Article 40 of Directive (EU) 2019/2034 or the relevant applicable requirements under Union or national law. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1b. For the purposes of the first subparagraph, point (fd), the relevant competent authority shall quantify the losses that the institution or entity has incurred or is likely to incur. That quantification shall be based, as a minimum, on asset quality reviews conducted by the European Central Bank, EBA or national authorities, or, where appropriate, on on-site inspections conducted by the competent authority. Where such exercises cannot be undertaken in due time, the competent authority can base its evaluation on the institution or entity’s balance sheet, provided that the balance sheet complies with the applicable accounting rules and standards, as confirmed by an independent external auditor. The competent authority should make its best efforts to ensure that the quantification is based on the market value of the institution or entity’s assets, liabilities and off-balance sheet items. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| 1c. If the evaluation is based on the institution or entity’s balance sheet, the support measures granted to the institution or entity shall encompass a clawback mechanism based on an ex-post quantification of losses at the time the support was granted, conducted by the competent authority. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| Member States shall ensure that the requirements of this Article are applied proportionately to national institutional protection schemes so as not to unduly hinder the operation of their preventive measures. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that DGSs may implement preventive measures only where the designated authority has confirmed that all the conditions laid down in paragraph 1 have been met. The designated authority shall notify the competent authority and the resolution authority. | 3. Member States shall ensure that DGSs confirm that all the conditions laid down in paragraph 1 have been met. The designated authority shall notify the competent authority and the resolution authority. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that DGSs may implement preventive measures only where the designated authority has confirmed that all the conditions laid down in paragraph 1 have been met. The designated authority shall notify the competent authority and the resolution authority. | 3. Member States shall ensure that DGSs inform the designated authority that all the conditions laid down in paragraph 1 have been met. The designated authority shall notify the competent authority and the resolution authority. |
| Text proposed by the Commission | Amendment |
|---|---|
| 4. Member States shall ensure that the DGS which uses its available financial means for capital support measures transfers its holdings of shares or other capital instruments in the supported credit institution to the private sector as soon as commercial and financial circumstances allow. | 4. Member States shall ensure that the DGS which uses its available financial means for capital support measures, where the conditions under Article 11b are met, transfers its holdings of shares or other capital instruments in the supported credit institution to the private sector as soon as commercial and financial circumstances allow. |
| Text proposed by the Commission | Amendment |
|---|---|
| 4a. EBA shall develop draft guidelines to specify the following: | |
| (a) the conditions referred to under paragraph 1, point (c); | |
| (b) the monitoring systems and decision making systems that DGSs are to have in place in accordance with paragraph 2. | |
| EBA shall submit those guidelines to the Commission by ... [one year after the date of entry into force of this amending Directive]. |
| Text proposed by the Commission | Amendment |
|---|---|
| 4a. EBA shall develop draft guidelines to specify the following: | |
| (a) the conditions referred to under paragraph 1, point (c); | |
| (b) the monitoring systems and decision making systems that DGSs are to have in place in accordance with paragraph 2. | |
| EBA shall submit those guidelines to the Commission by ... [one year after the date of entry into force of this amending Directive]. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for consultation a note with measures that those credit institutions commit to undertake to ensure or restore compliance with the supervisory requirements applicable to the credit institution concerned and that are laid down in Directive 2013/36/EU and Regulation (EU) No 575/2013. | 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority a note with measures that those credit institutions commit to undertake to ensure and maintain compliance with the applicable supervisory requirements laid down in Directive 2013/36/EU and Regulation (EU) No 575/2013. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for consultation a note with measures that those credit institutions commit to undertake to ensure or restore compliance with the supervisory requirements applicable to the credit institution concerned and that are laid down in Directive 2013/36/EU and Regulation (EU) No 575/2013. | 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority a note with measures that those credit institutions commit to undertake to ensure and maintain compliance with the applicable supervisory requirements laid down in Directive 2013/36/EU and Regulation (EU) No 575/2013. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for consultation a note with measures that those credit institutions commit to undertake to ensure or restore compliance with the supervisory requirements applicable to the credit institution concerned and that are laid down in Directive 2013/36/EU and Regulation (EU) No 575/2013. | 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for approval a restructuring plan to ensure or restore long-term viability and compliance with supervisory requirements applicable to the institution concerned in accordance with Directive 2013/36/EU and Regulation (EU) No 575/2013. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for consultation a note with measures that those credit institutions commit to undertake to ensure or restore compliance with the supervisory requirements applicable to the credit institution concerned and that are laid down in Directive 2013/36/EU and Regulation (EU) No 575/2013. | 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for approval a restructuring plan to ensure or restore long-term viability and compliance with supervisory requirements applicable to the institution concerned in accordance with Directive 2013/36/EU and Regulation (EU) No 575/2013. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for consultation a note with measures that those credit institutions commit to undertake to ensure or restore compliance with the supervisory requirements applicable to the credit institution concerned and that are laid down in Directive 2013/36/EU and Regulation (EU) No 575/2013. | 1. Member States shall ensure that credit institutions which request a DGS to finance preventive measures in accordance with Article 11(3) present to the competent authority for approval a restructuring plan to ensure or restore long term viability an compliance with the supervisory requirements applicable to the credit institution concerned in accordance with Directive 2013/36/EU and Regulation (EU) No 575/2013. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. The note referred to in paragraph 1 shall set out actions to mitigate the risk of deterioration of the financial soundness and strengthen the credit institution’s capital and liquidity position. | 2. The restructuring plan referred to in paragraph 1 shall set out actions to mitigate the risk of deterioration of the financial soundness and strengthen the credit institution’s capital and liquidity position. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2a. Where the financial means of a DGS are used for preventive measures in accordance with paragraph 3, the competent authority shall require the beneficiary credit institution to update the recovery plan referred to in Article 5 or 7 of Directive 2014/59/EU, as applicable. The competent authority shall direct the supported credit institution to implement the measures referred to in Article 6(6), third subparagraph, of Directive 2014/59/EU. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2a. Where the financial means of a DGS are used for preventive measures in accordance with paragraph 3, the competent authority shall require the beneficiary credit institution to update the recovery plan referred to in Article 5 or 7 of Directive 2014/59/EU, as applicable. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that in the event of a capital support measure, the note referred to in paragraph 1 identifies all capital raising measures that can be implemented, including safeguards preventing outflows of funds, a forward-looking capital adequacy assessment, and a subsequent determination of the capital shortfall that the DGS has to cover. | 3. Member States shall ensure that in the event of a capital support measure, the restructuring plan referred to in paragraph 1 identifies all capital raising measures that can be implemented, including safeguards preventing outflows of funds, a forward-looking capital adequacy assessment, and a subsequent determination of the capital shortfall that the DGS has to cover. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that in the event of a capital support measure, the note referred to in paragraph 1 identifies all capital raising measures that can be implemented, including safeguards preventing outflows of funds, a forward-looking capital adequacy assessment, and a subsequent determination of the capital shortfall that the DGS has to cover. | 3. Member States shall ensure that in the event of a capital support measure, the note referred to in paragraph 1 identifies all capital raising measures that can be implemented, including safeguards preventing outflows of funds, a forward-looking capital adequacy assessment, and, as determined by the competent authority, the capital shortfall that the DGS has to cover. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3a. In the event of a capital support measure, Member States shall ensure that shareholders and subordinated debt holders of the supported credit institution have contributed to reducing the capital shortfall. Such contributions shall take the form of the writing down and converting of capital instruments and eligible liabilities in accordance with Articles 59 to 62 of Directive 2014/59/EU by the competent authorities or the resolution authorities. Member States shall ensure that no preventive measures in the form of capital support financed by DGSs are undertaken before the requirements set out in the first subparagraph are met. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3a. In the event of a capital support measure, Member States shall ensure that shareholders and debt holders of the supported credit institution have contributed to reducing the capital shortfall to the maximum extent. |
| Text proposed by the Commission | Amendment |
|---|---|
| 5. Where relevant, Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the capital conservation plan referred to in Article 142 of Directive 2013/36/EU. | 5. Member States shall ensure that the competent authorities establish that no dividends, share buy-backs or variable remuneration are paid out and that no irrevocable commitment to pay out dividends, share buy-backs or variable remuneration is undertaken by the supported credit institution. Member States shall ensure that the restrictions under this paragraph remain in place until the supported credit institutions has replenished the DGS with the same amount used for such measures. |
| Text proposed by the Commission | Amendment |
|---|---|
| 5. Where relevant, Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the capital conservation plan referred to in Article 142 of Directive 2013/36/EU. | 5. Member States shall ensure that the competent authorities establish that no dividends, share buy-backs or variable remuneration are paid out and that no irrevocable commitment to pay out dividends, share buy-backs or variable remuneration is undertaken by the supported credit institution. Member States shall ensure that the restrictions under this paragraph remain in place until the supported credit institutions provides the DGS with the means used for such measures. |
| Text proposed by the Commission | Amendment |
|---|---|
| 5a. It shall be ensured that the deposit guarantee scheme is properly remunerated for the preventive measure and that the beneficiary credit institution, its shareholders, its creditors or the business group to which it belongs, contribute significantly to the restructuring or liquidation costs from their own resources. Preventive measures to support liquidity provision shall be temporary, shall not be used to absorb losses and shall not become capital support. Proper remuneration shall be paid to the deposit guarantee scheme for the preventive measures granted to support liquidity provision. |
| Text proposed by the Commission | Amendment |
|---|---|
| 5a. It shall be ensured that the DGS is properly remunerated for the preventive measure and that the beneficiary credit institution, its shareholders, its creditors or the business group to which it belongs, contribute significantly to the restructuring or liquidation costs from their own resources. Preventive measures to support liquidity provision shall be temporary, shall not be used to absorb losses and shall not become capital support. Proper remuneration shall be paid to the DGS for the preventive measures granted to support liquidity provision. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Where the Union State aid framework is applicable, Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the restructuring plan that the credit institution is required to submit to the Commission under that framework. | 6. All measures under this Directive are not subject to state aid law. |
All measures under the DGSD should explicitly not be subject to state aid law. The DGS funds are privately collected, they are not taxpayers' money. In addition, a state aid audit causes a long delay, which prevent the rapid implementation of preventive or alternative measures or deposit compensation. Article 11b(6) makes the implementation of preventive measures virtually impossible in view of the timeline. Accordingly, Article11b(6) DGSD draft should be deleted.
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Where the Union State aid framework is applicable, Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the restructuring plan that the credit institution is required to submit to the Commission under that framework. | 6. Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the restructuring plan that the credit institution is required to submit to the Commission under that framework, in accordance with the Union State aid framework, to be accordingly updated taking into account the European Court of Justice pronouncements, before the entry into force of the Directive. |
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Where the Union State aid framework is applicable, Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the restructuring plan that the credit institution is required to submit to the Commission under that framework. | 6. Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the restructuring plan that the credit institution is required to submit to the Commission under that framework, in accordance with the Union State aid framework, to be accordingly updated before the entry into force of the Directive. |
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Where the Union State aid framework is applicable, Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the restructuring plan that the credit institution is required to submit to the Commission under that framework. | 6. Where the Union State aid framework is applicable, Member States shall ensure that the measures envisaged in the restructuring plan referred to in paragraph 1 are compatible with the restructuring plan, that the credit institution is required to submit to the Commission under that framework. |
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Where the Union State aid framework is applicable, Member States shall ensure that the measures envisaged in the note referred to in paragraph 1 are aligned with the restructuring plan that the credit institution is required to submit to the Commission under that framework. | 6. Where the Union State aid framework is applicable, Member States shall ensure that the measures envisaged in the restructuring plan referred to in paragraph 1 are compatible with the restructuring plan that the credit institution is required to submit to the Commission under that framework. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| 6a. Member States shall ensure that, by way of derogation from paragraphs (1) to (5) of this Article, for member institutions of an IPS referred to in of Article 1(2), point (c), of this Directive, the following shall apply: When granting a preventive measure, the IPS requires and the credit institution is obliged to prepare and submit to the IPS a comprehensive restructuring concept within a reasonable period of time after the measure is granted, showing the way to restore the basic profitability of the institution. This includes compliance with the regulatory requirements applicable to the credit institution concerned. |
A comprehensive, institution-specific restructuring concept, including a detailed status-quo analysis and a business plan, is in any case already regularly a mandatory part of the contract on support measures between the institution and the IPS. However, preparation requires some time until final acceptance by the IPS, in order to show valid results and thus the way to restore the bank's basic profitability. This concept with an underlying and reliable business plan is also subject to close implementation control by the IPS as is, including all necessary countermeasures in the event of significant deviations.
| Text proposed by the Commission | Amendment |
|---|---|
| 6a. The competent authority shall provide the note to the resolution authority. The resolution authority may examine the note with a view to identifying any actions which may adversely impact the resolvability of the institution and make recommendations to the competent authority with regard to those matters. The resolution authority shall communicate its assessment and recommendations within the timeframe set by the competent authority. |
| Text proposed by the Commission | Amendment |
|---|---|
| 6a. The competent authority shall have two weeks to approve the restructuring plan. When the competent authority deems the restructuring plan unsatisfactory, the envisaged preventive measure cannot be undertaken. |
Preventive forms of support should be treated on an equal footing to preserve the level playing field, whether they come from public funds or from a private DGS. Therefore these conditions should be aligned with those of Article 32c BRRD and must ensure that the core principles of the State Aid framework are enshrined in level 1 in DGSD. This can of course affect the functioning of IPSs as regards their voluntary and statutory missions, and therefore means to cater for their specificities may need to be explored.
| Text proposed by the Commission | Amendment |
|---|---|
| 6a. The competent authority shall have two weeks to approve the restructuring plan. When the competent authority deems the restructuring plan unsatisfactory, the envisaged preventive measure cannot be undertaken. |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Member States shall ensure that where the credit institution fails to fulfil the commitments outlined in the note referred to in Article 11b(1), or fails to repay the amount contributed under the preventive measures at maturity, the DGS informs the competent authority thereof without delay. | 1. Member States shall ensure that where the credit institution fails to fulfil the commitments outlined in the restructuring plan referred to in Article 11b(1), or fails to repay the amount contributed under the preventive measures at maturity, the DGS informs the competent authority thereof without delay. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. In the situation referred to in paragraph 1, Member States shall ensure that the competent authority requests the credit institution to submit a remediation plan describing the steps the credit institution will take to ensure or restore compliance with supervisory requirements, to ensure its long term viability and to repay the due amount contributed by the DGS to the preventive measure, as well as the associated timeframe. | 2. In the situation referred to in paragraph 1, Member States shall ensure that the credit institution shall submit a remediation plan to the designated authority and the DGS describing the steps the credit institution will take to ensure or restore compliance with supervisory requirements, to ensure its long- term viability and to repay the due amount contributed by the DGS to the preventive measure, as well as the associated timeframe. The designated authority and the DGS shall consult the competent authority as regards the measures envisaged in the remediation plan submitted by the credit institution that aim to ensure or restore compliance with supervisory requirements. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. In the situation referred to in paragraph 1, Member States shall ensure that the competent authority requests the credit institution to submit a remediation plan describing the steps the credit institution will take to ensure or restore compliance with supervisory requirements, to ensure its long term viability and to repay the due amount contributed by the DGS to the preventive measure, as well as the associated timeframe. | 2. In the situation referred to in paragraph 1, the competent authority shall request the credit institution submits a remediation plan to the designated authority and the DGS describing the steps the credit institution will take to ensure or restore compliance with supervisory requirements, to ensure its long term viability and to repay the due amount contributed by the DGS to the preventive measure, as well as the associated timeframe. The designated authority and the DGS shall consult the competent authority as regards the measures envisaged in the remediation plan. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Where the competent authority is not satisfied that the remediation plan is credible or feasible, the DGS shall not grant any further preventive measures to that credit institution. | 3. Where the competent authority is not satisfied that the remediation plan is credible or feasible or where the credit institutions fails to comply with the remediation plan foreseen in Article 11c(1) or fails to repay the amount contributed under the preventive measures at maturity, the DGS shall not grant any further preventive measures to that credit institution and the relevant authorities shall carry out an assessment of whether the institution is failing or is likely to fail, in accordance with Article 32 of Directive 2014/59/EU. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Where the competent authority is not satisfied that the remediation plan is credible or feasible, the DGS shall not grant any further preventive measures to that credit institution. | 3. Where the designated authority is not satisfied that the remediation plan is credible or feasible, the DGS shall not grant any further preventive measures to that credit institution. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Where the competent authority is not satisfied that the remediation plan is credible or feasible, the DGS shall not grant any further preventive measures to that credit institution. | 3. Where the competent authority is not satisfied that the remediation plan is credible or feasible, the institution shall be deemed failing or likely to fail. |
In case the remediation plan does not work, there needs to be a FOLF determination. Also, the EBA guidelines should be adopted earlier.
| Text proposed by the Commission | Amendment |
|---|---|
| 4. By … [OP – please insert the date = 42 months after the date of entry into force of this Directive] the EBA shall issue guidelines setting elements of the note accompanying the preventive measures referred to in Article 11b(1) and the remediation plan referred to in paragraph 1 of this Article. | 4. By … [OP – please insert the date = 24 months after the date of entry into force of this Directive] the EBA shall issue guidelines setting elements of the restructuring plan accompanying the preventive measures referred to in Article 11b(1) and the remediation plan referred to in paragraph 1 of this Article. |
| Text proposed by the Commission | Amendment |
|---|---|
| 4. By … [OP – please insert the date = 42 months after the date of entry into force of this Directive] the EBA shall issue guidelines setting elements of the note accompanying the preventive measures referred to in Article 11b(1) and the remediation plan referred to in paragraph 1 of this Article. | 4. By … [OP – please insert the date = 24 months after the date of entry into force of this Directive] the EBA shall issue guidelines setting elements of the note accompanying the preventive measures referred to in Article 11b(1) and the remediation plan referred to in paragraph 1 of this Article. |
In case the remediation plan does not work, there needs to be a FOLF determination. Also, the EBA guidelines should be adopted earlier.
| Text proposed by the Commission | Amendment |
|---|---|
| 4a. Member States shall ensure that, by way of derogation from paragraphs (1) to (4) of this Article, for member institutions of an IPS referred to in of Article 1 (2) point c) of this Directive, the following shall apply: Where the credit institution fails to fulfil the commitments outlined in the restructuring concept referred to in Article 11b paragraph (7), the IPS shall require and the institute is obliged to revise the concept describing the steps the credit institution will take to ensure or restore compliance with supervisory requirements and to ensure its long term viability. The IPS informs the competent authority thereof without delay. |
A comprehensive, institution-specific restructuring concept, including a detailed status-quo analysis and a business plan, is in any case already regularly a mandatory part of the contract on support measures between the institution and the IPS. However, preparation requires some time until final acceptance by the IPS, in order to show valid results and thus the way to restore the bank's basic profitability. This concept with an underlying and reliable business plan is also subject to close implementation control by the IPS, including all necessary countermeasures in the event of significant deviations.
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Where Member States allow the use of DGS funds for the alternative measures referred to in Article 11(5), they shall ensure that when DGSs finance such measures the credit institutions market, or make arrangements for the marketing of, the assets, rights and liabilities those credit institutions intend to transfer. Without prejudice to the Union State aid framework, such marketing shall comply with all of the following: | 1. Member States shall enable the use of DGS funds for the alternative measures referred to in Article 11(5). Member States shall ensure that when DGSs finance such measures a marketing, or arrangements for the marketing should be performed having regard to the assets, rights and liabilities the credit institutions intend to transfer. Without prejudice to the Union State aid framework, such marketing shall comply with all of the following: |
| Text proposed by the Commission | Amendment |
|---|---|
| 1. Where Member States allow the use of DGS funds for the alternative measures referred to in Article 11(5), they shall ensure that when DGSs finance such measures the credit institutions market, or make arrangements for the marketing of, the assets, rights and liabilities those credit institutions intend to transfer. Without prejudice to the Union State aid framework, such marketing shall comply with all of the following: | 1. Member States shall allow the use of DGS funds for the alternative measures referred to in Article 11(5), ensuring that when DGSs finance such measures the credit institutions market, or make arrangements for the marketing of, the assets, rights and liabilities those credit institutions intend to transfer. Without prejudice to the Union State aid framework, such marketing shall comply with all of the following: |
| Text proposed by the Commission | Amendment |
|---|---|
| 1a. ‘Article 11da | |
| Support granted to portfolio transfers in alternative measures | |
| 1. Member States shall ensure that, where the DGS is used in accordance with Article 11(5) with respect to a credit institution, and provided that such action ensures that natural persons and micro, small and medium-sized enterprises continue to have access to their deposits, to prevent them from bearing losses, the DGS to which that credit institution is affiliated shall contribute the following amounts: | |
| (i) the amount necessary to cover the difference between the value of the covered deposits and of the liabilities with the same or a higher priority ranking, and the value of the assets of the institution under resolution which are to be transferred to a recipient; and | |
| (ii) where relevant, an amount necessary to ensure the capital neutrality of the recipient following the transfer. | |
| 2. Member States shall ensure that the available financial means used in accordance with Article 11(5) does not exceed 25% of DGS target level pursuant to Article 10. | |
| Should the amount needed from the DGS be greater than 25% of its target level, the affiliated credit institutions shall immediately provide the DGS with the means needed to finance the remaining part, where necessary in the form of extraordinary contributions. |
The DGS capacity to support transfer strategies shall not be greater in insolvency than in resolution, in accordance with the resolution objective to preserve its funds, applicable both in resolution and in insolvency.
| Text proposed by the Commission | Amendment |
|---|---|
| (a) the estimated cost for the DGS to finance the measures referred to in Article 11 (2), (3) or (5); | (a) the estimated direct cost for the DGS to finance the measures referred to in Article 11 (2), (3) or (5); |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the estimated cost of repaying depositors in accordance with Article 8(1). | (b) the estimated direct cost of repaying depositors in accordance with Article 8(1). |
| Text proposed by the Commission | Amendment |
|---|---|
| (a) for the estimation of the costs referred to in paragraph 1, point (a), the DGS shall take into account the expected earnings, operational expenses and potential losses related to the measure; | (a) the costs referred to in paragraph 1, point (a) shall be estimated as the difference between: |
| (i) the sum of the amount disbursed by the DGS to finance the measure, the administrative costs of levying ex post contributions pursuant to Article 10(8) should such contributions be needed to finance the measure, and the costs of mobilizing alternative funding arrangements pursuant to Article 10(9) should these arrangements be mobilised; and | |
| (ii) the expected recoveries on the claim held by the DGS pursuant article 9(2). |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) for the measures referred to in Article 11(2) and (5), the DGS shall base its estimation of the cost of repaying depositors, as referred to in paragraph 1, point (b), on the valuation of the credit institution’s assets and liabilities referred to in Article 36(1) of Directive 2014/59/EU and the estimate referred to in Article 36(8) of that Directive; | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| (c) for the measures referred to in Article 11(2), (3) and (5), when estimating the cost of repaying depositors, as referred to in paragraph 1, point (b), the DGS shall take into account the expected ratio of recoveries, the cost for the replenishment of the DGS that is to be borne by credit institutions that are members of the DGS, and the potential additional cost of funding for the DGS; | (c) the cost of repaying depositors, as referred to in paragraph 1, point (b), shall be estimated as the difference between: |
| (i) the sum of the estimated amount to be paid to depositors, the administrative costs linked to the process of repayment that are not covered by annual contributions, the administrative costs of levying ex post contributions pursuant to Article 10(8) should such contributions be needed to repay the depositors, and the costs of mobilizing alternative funding arrangements pursuant to Article 10(9) should these arrangements be mobilised; and | |
| (ii) the expected recoveries on the claim held by the DGS pursuant to article 9(2). The recovery rate on this claim should not be lower than 50%. |
| Text proposed by the Commission | Amendment |
|---|---|
| (c) for the measures referred to in Article 11(2), (3) and (5), when estimating the cost of repaying depositors, as referred to in paragraph 1, point (b), the DGS shall take into account the expected ratio of recoveries, the cost for the replenishment of the DGS that is to be borne by credit institutions that are members of the DGS, and the potential additional cost of funding for the DGS; | (c) for the measures referred to in Article 11(2), (3) and (5), when estimating the cost of repaying depositors, as referred to in paragraph 1, point (b), the DGS shall take into account the expected ratio of recoveries and any indirect costs, including the cost for the replenishment of the DGS that is to be borne by credit institutions that are members of the DGS, and the potential additional costs of funding for the DGS and for the banking system and the impact on the weaker banks; |
| Text proposed by the Commission | Amendment |
|---|---|
| (d) for the measures referred to in Article 11(3), when estimating the cost of repaying depositors, the DGS shall multiply the estimated ratio of recoveries calculated in accordance with the methodology referred to in paragraph 5, point b, by 85 %. | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| (d) for the measures referred to in Article 11(3), when estimating the cost of repaying depositors, the DGS shall multiply the estimated ratio of recoveries calculated in accordance with the methodology referred to in paragraph 5, point b, by 85 %. | (d) for the measures referred to in Article 11(2), (3), and (5) when estimating the cost of repaying depositors, the DGS shall multiply the estimated ratio of recoveries calculated in accordance with the methodology referred to in paragraph 5, point b, by 85 %. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that the amount used to finance the resolution of credit institutions, as referred to in Article 11(2), for the preventive measures referred to in Article 11(3), or for the alternative measures referred to in Article 11(5), does not exceed the amount of covered deposits at the credit institution. | 3. Member States shall ensure that the amount used to finance the resolution of credit institutions, as referred to in Article 11(2) or for the alternative measures referred to in Article 11(5), does not exceed the amount of covered deposits at the credit institution. |
| Text proposed by the Commission | Amendment |
|---|---|
| 4a. As soon as possible after performing alternative measures, Member States shall ensure that DGS publish a summary of the core elements of the calculation made as per this Article. It shall notably comprise the net recovery rate derived from the estimated cost of repaying depositors for the DGS and a broad justification of the related underlying assumptions. |
| Text proposed by the Commission | Amendment |
|---|---|
| 5. The EBA shall develop draft regulatory technical standards to specify: | deleted |
| (a) the methodology for the calculation of the estimated cost referred to in paragraph 1, point (a), which shall take into account the specific features of the measure concerned; | |
| (b) the methodology for the calculation of the estimated cost of repaying depositors referred to in paragraph 1, point (b), including the estimated ratio of recoveries referred to in paragraph 2, point (c); | |
| (c) the way to account, in the methodologies referred to in points (a), (b) and (c), where relevant, for the change of value of money due to potential accrued earnings over time. | |
| For the calculation of the estimated cost of repaying depositors as referred to in paragraph 1, point (b), in the case of preventive measures, the methodology referred to in point (b) shall take into account the importance of preventive measures for the statutory or contractual mandate of the DGS, including IPS referred to in Article 1(2), point (c). | |
| The EBA shall submit those draft regulatory technical standards to the Commission by …[OP – please insert the date= 12 months after the date of entry into force of this Directive]. | |
| Power is delegated to the Commission to supplement this Directive by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.’; |
| Text proposed by the Commission | Amendment |
|---|---|
| The EBA shall develop draft regulatory technical standards to specify: | The EBA, taking into account the regulatory technical standards developed in accordance with Article 36(15) of Directive 2014/59/EU and adopted pursuant to Article 36(16) thereof, shall develop draft regulatory technical standards to specify: |
| Text proposed by the Commission | Amendment |
|---|---|
| The EBA shall develop draft regulatory technical standards to specify: | The EBA shall develop guidelines to specify, taking into consideration the specific features of each Member State: |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the methodology for the calculation of the estimated cost of repaying depositors referred to in paragraph 1, point (b), including the estimated ratio of recoveries referred to in paragraph 2, point (c); | (b) the methodology for the calculation of the estimated cost of repaying depositors referred to in paragraph 1, point (b), including the estimated ratio of recoveries referred to in paragraph 2, point (c), which shall take into account the specific features of the Member State concerned; |
| Text proposed by the Commission | Amendment |
|---|---|
| For the calculation of the estimated cost of repaying depositors as referred to in paragraph 1, point (b), in the case of preventive measures, the methodology referred to in point (b) shall take into account the importance of preventive measures for the statutory or contractual mandate of the DGS, including IPS referred to in Article 1(2), point (c). | For the calculation of the estimated cost of repaying depositors as referred to in paragraph 1, point (b), in the case of preventive measures, the methodology referred to in point (b) shall take into account the importance of preventive measures for the statutory or contractual mandate of the DGS. |
| Regarding IPS referred to in Article 1(2) point (c), prevented reputational damage by protecting the joint corporate trademark are to be taken into account as well as prevented external costs in the specific region through continuation of credit and financial services function of the institutions belonging to an IPS referred to in Article 1(2) point (c). |
| Text proposed by the Commission | Amendment |
|---|---|
| The EBA shall submit those draft regulatory technical standards to the Commission by …[OP – please insert the date= 12 months after the date of entry into force of this Directive]. | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| Power is delegated to the Commission to supplement this Directive by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.’; | deleted |
| Text proposed by the Commission | Amendment |
|---|---|
| 5a. Member States shall ensure that where a DGS faces a liquidity shortfall, it can access the EU credit line and guarantee managed by the SRB. No additional contributions should be requested to finance the EU credit line and guarantee. The requesting DGS shall inform EBA and the SRB without delay and state the reasons why and the amount of money requested to address its liquidity shortfall. Member States shall ensure that the DGS informs the SRB as soon as it anticipates a risk of a liquidity shortfall. | |
| Where a DGS has exhausted its recourse to the EU credit line, Member States shall ensure that DGSs located in other Member States provide the DGS with the liquidity shortfall with the necessary financial means to perform its functions in accordance with Article 11. | |
| The liquidity shortfall referred to in paragraph 1 shall be calculated as the total amount of covered deposits that is held by the credit institution at the time of the payout event or the amount of the available financial means used by the DGS to finance preventive or alternative measures as referred to in Article 11(3) and (5), minus the following: | |
| (a) the amount of available financial means the DGS has raised in accordance with Article 10 (1); | |
| (b) the amount of extraordinary contributions within the meaning of Article 10(8) that the DGS can raise within five days of the payout event or the amount of alternative funding arrangements and ex-post contributions that the DGS can raise within five days of financing the use of preventive or alternative measures. | |
| In cases where the DGS is used in resolution proceedings in accordance with Article 11(2), its liquidity shortfall shall be the amount determined by the resolution authority in accordance with Article 79 of Regulation (EU) 806/2014 minus the amount of the available financial means of the DGS. Paragraphs 1 to 1c of this Article may apply in cases where the DGS encounters a payout event or in the context of measures referred to in Article 11 (2), (3) and (5) of this Directive." |
| Text proposed by the Commission | Amendment |
|---|---|
| 5b. Member States shall ensure that the contributions levied by the borrowing DGS are sufficient to reimburse the lending DGSs and the EU credit line or guarantee with the amount borrowed and to re-establish the target level as soon as possible and in any event in less than six years. |
| Text proposed by the Commission | Amendment |
|---|---|
| (13a) the following Article 11f is inserted: | |
| Preventive measures by IPSs | |
| 1. By way of derogation from Articles 11a to 11e, IPSs officially recognised as DGSs according to Article 4(2) may use the available financial means for preventive measures referred to in Article 11(3a) provided that the following conditions are met: | |
| (a) the credit institution requesting financing of the preventive measures shall be obliged to present a plan to ensure or restore compliance of the credit institution with the supervisory requirements set forth in Directive 2013/36/EU and Regulation (EU) No. 575/2013 in accordance with the conditions laid down in the statutory rules of the IPS as approved by the competent authority in accordance with Art. 113(7) of Regulation (EU) No. 575/2013; | |
| (b) the competent authority has been consulted by the IPS on the preventive measures and the conditions imposed on the supported credit institution; | |
| (c) the use of preventive measures by the IPS is linked to conditions imposed on the supported credit institution, involving at least more stringent risk monitoring of the credit institution and greater verification rights for the IPS; | |
| (d) the use of preventive measures by the IPS is conditional on the credit institution’s commitments to secure access to covered deposits; | |
| (e) the ability of the affiliated credit institutions to pay the extraordinary contributions in accordance with Article 11(4) is confirmed; and | |
| (f) the costs of the measures do not exceed the costs of fulfilling the IPS’s statutory or contractual mandate which is recognised as fulfilling the criteria laid down in Art. 113(7) of Regulation (EU) No. 575/2013. | |
| 2. Member States shall ensure that IPSs have monitoring systems and appropriate procedures in place for selecting and implementing preventive measures and monitoring affiliated risks. | |
| 3. Such preventive measures carried out by an IPS shall not lead to the determination that the credit institution is failing or is likely to fail in the sense of Article 32(1) of Directive 2014/59/EU or Article 18(1) of Regulation (EU) 806/2014. |
Recognises the special role of IPS: IPSs use preventive measures as a mean to prevent the compensation case and thus to ensure deposit protection. For them preventive measures are the standard case, not one of several possible instruments of a tool box selection.
| Text proposed by the Commission | Amendment |
|---|---|
| (13a) the following Article 11 f is inserted: | |
| Article 11f | |
| Preventive Measures by Institutional Protection Schemes | |
| 1. By way of derogation from Article 11 (3) and Articles 11a to 11e, Member States may allow an IPS falling under Article 1(2)(c) to use the available financial means for measures in order to prevent the failure of a credit institution provided that the following conditions are met: | |
| (a) the resolution authority has not taken any resolution action under Article 32 of Directive 2014/59/EU; | |
| (b) the IPS has appropriate systems and procedures in place for selecting and implementing alternative measures and monitoring affiliated risks which do not exceed the costs of fulfilling the statutory or contractual mandate of the IPS; | |
| (c) the use of these measures is accompanied by conditions for the supported credit institution, including more stringent risk monitoring and commitments as regards to securing access to covered deposits; | |
| (d) the credit institution requesting financing of the preventive measures shall be obliged to present a plan to ensure or restore compliance of the credit institution with the supervisory requirements set forth in Directive 2013/36/EU and Regulation (EU) No. 575/2013 in accordance with the conditions laid down in the statutory rules of the IPS as approved by the competent authority in accordance with Art. 113(7) of Regulation (EU) No. 575/2013. | |
| 2. Member States shall ensure that the competent authority has been consulted by the IPS on the preventive measures and the conditions imposed on the supported credit institution. They shall also verify the IPSs monitoring systems and decision-making procedures meet the conditions of this Article. |
| Text proposed by the Commission | Amendment |
|---|---|
| Article 11f | |
| Preventive measures by IPS | |
| 1. Where the institution is a member of a recognized IPS under Article 1(2), point (c), the IPS shall be consulted by the resolution authority prior to taking any resolution measures and shall be given the opportunity to implement preventive measures. | |
| 2. By way of derogation from Articles 11a to 11e, Member States may allow an IPSs to use the available financial means for preventive measures referred to in Article 11(3), point (b), provided that the following conditions are met: | |
| (a) the competent authority has been consulted by the IPS on the preventive measures and the conditions imposed on the supported credit institution; | |
| (b) the credit institution requesting financing of the preventive measures shall be obliged to present a plan to ensure or restore compliance of the credit institution with the supervisory requirements set forth in Directive 2013/36/EU and Regulation (EU) No. 575/2013 in accordance with the conditions laid down in the statutory rules of the IPS as approved by the competent authority in accordance with Art. 113(7) of Regulation (EU) No. 575/2013; | |
| (c) the use of preventive measures by the IPS is conditional on the credit institution’s commitments to secure access to covered deposits; | |
| (d) the use of preventive measures by the IPS is linked to conditions imposed on the supported credit institution, involving at least more stringent risk monitoring of the credit institution and greater verification rights for the IPS; | |
| (e) the ability of the affiliated credit institutions to pay the extraordinary contributions in accordance with Article 11(4) is confirmed; | |
| (f) the costs of the measures do not exceed the costs of fulfilling the IPS’s statutory or contractual mandate which is recognised as fulfilling the criteria laid down in Art. 113(7) of Regulation (EU) No. 575/2013 in accordance with the conditions laid down in the statutory rules of the IPS as approved by the competent authority in accordance with Art. 113(7) of Regulation (EU) No. 575/2013. External costs in society as well as in the network of the institutional protection scheme are taken into account. | |
| 3. Member States shall ensure that IPSs have monitoring systems and decision making procedures in place that are appropriate for selecting and implementing preventive measures and monitoring affiliated risks. | |
| 4. Such preventive measures carried out by an IPS shall not lead to the determination that the credit institution is failing or is likely to fail in the sense of Article 32 (1) of Directive 2014/59/EU or Art. 18 (1) of Regulation (EU) 806/2014.’ |
| Text proposed by the Commission | Amendment |
|---|---|
| (13a) the following Article 12a is added: | |
| Support by the Single Resolution Fund to alternative funding arrangements | |
| 1. Where the intervention of a DGS within the Banking Union is necessary in the context of a resolution but its available financial means are insufficient to achieve the purposes of its intervention, the DGS may request support, in the form of a guarantee, from the Single Resolution Fund (SRF). | |
| 2. The DGS request shall include all relevant information, including: | |
| (i) the shortfall of the deposit guarantee scheme for the purposes of the specific intervention in the resolution; | |
| (ii) the conditions offered to the deposit guarantee scheme in other alternative funding arrangements; | |
| (iii) the expected length of the requested support. | |
| 3. The Single Resolution Board shall take a decision, including on the terms applicable to the guarantee provision, according to Article 79a of Regulation 806/2014 (EU). | |
| 4. The SRF guarantee provided to the DGS shall be used as collateral for alternative funding arrangements as referred to in Article 10(9) of Directive 2014/49/EU, thus ensuring access to markets in more favourable conditions. |
| Present text | Amendment |
|---|---|
| (13a) Article 13(1) is replaced by the following: | |
| 1. The contributions to DGSs referred to in Article 10 shall be based on the amount of covered deposits and the degree of risk incurred by the respective member. | “1. The contributions to DGSs referred to in Article 10 shall be based on the amount of covered deposits and the degree of risk incurred by the respective members of any single DGS. |
| Member States may provide for lower contributions for low-risk sectors which are regulated under national law. | Member States may provide for lower contributions for low-risk sectors of credit institutions affiliated to a DGS which are regulated under national law. |
| Member States may decide that members of an IPS pay lower contributions to the DGS. | Member States may decide that members of an IPS pay lower contributions to the DGS to which they are affiliated. |
| Member States may allow the central body and all credit institutions permanently affiliated to the central body as referred to in Article 10(1) of Regulation (EU) No 575/2013 to be subject as a whole to the risk weight determined for the central body and its affiliated institutions on a consolidated basis. | Member States may allow the central body and all credit institutions permanently affiliated to the central body as referred to in Article 10(1) of Regulation (EU) No 575/2013 to be subject as a whole to the risk weight determined for the central body and its affiliated institutions on a consolidated basis. |
| Member States may decide that credit institutions pay a minimum contribution, irrespective of the amount of their covered deposits. | Member States may decide that credit institutions pay a minimum contribution, irrespective of the amount of their covered deposits.” |
| Text proposed by the Commission | Amendment |
|---|---|
| (13a) In Article 13(1), the third subparagraph is replaced by the following: | |
| Member States may decide that members of an IPS pay lower contributions to the DGS of which they are a member. |
In some countries IPS have proved themselves to be an important factor raising the stability of the cooperative banking sector, raising the assets quality and providing additional liquidity and internal audit among the IPS members, without providing an additional layer of DGS protection. Thus, the argument that they interfere with the idea of EDIS is not justified. Hence, I disagree with deleting this text, as proposed by the Rapporteur. The approach should be more nuanced and not a matter of one-size-fits-all.
| Text proposed by the Commission | Amendment |
|---|---|
| 2a. Member States shall ensure that a DGS of a host Member State may, subject to an agreement with a DGS of a home Member State, act as the point of contact for depositors at credit institutions that exercise the freedom to provide services as referred to in Title V, Chapter 3, of Directive 2013/36/EU, and shall be compensated for the costs incurred. | 2a. Member States shall ensure that a DGS of a host Member State may, subject to an agreement with a DGS of a home Member State, act as the point of contact for depositors at credit institutions that exercise the freedom to provide services as referred to in Title V, Chapter 3, of Directive 2013/36/EU, and shall be compensated for the costs incurred. DGS of a home Member State shall provide to the DGS of the host Member State information on the number of depositors, amount of covered deposits and possible relevant changes to these. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS the contributions due for the last 12 months preceding the change of DGS membership, with the exception of the extraordinary contributions referred to in Article 10(8).; | 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS an amount that reflects the additional potential liabilities borne by the receiving DGS as a result of the transfer, taking into account the impact of the transfer on the financial situation of both DGSs relative to the risks they cover. |
| EBA shall develop draft regulatory technical standards to specify the methodology for the calculation of the amount to be transferred. | |
| EBA shall submit those draft regulatory technical standards to the Commission by ... [12 months after the date of entry into force of this amending Directive]. | |
| Power is delegated to the Commission to supplement this Directive by adopting the regulatory technical standards referred to in the second subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010 of the European Parliament and of the Council. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS the contributions due for the last 12 months preceding the change of DGS membership, with the exception of the extraordinary contributions referred to in Article 10(8).; | 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS an amount that reflects the additional potential liabilities borne by the receiving DGS as a result of the transfer, taking into account the impact of the transfer on the financial situation of both DGSs relative to the risks they cover. |
| EBA shall develop guidelines to specify the methodology for the calculation of the amount to be transferred to ensure a neutral impact of the transfer on the financial situation of both DGSs relative to the risks they cover. | |
| EBA shall submit those draft guidelines to the Commission by ... [12 months after the date of entry into force of this amending Directive]. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS the contributions due for the last 12 months preceding the change of DGS membership, with the exception of the extraordinary contributions referred to in Article 10(8).; | 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS the contributions of the related credit institution, with the exception of the extraordinary contributions referred to in Article 10(8), net of profits and losses recorded by the DGS of origin, including past intervention, investment income and expected recoveries.’; |
The change of DGS membership transfers all the risk from the original DGS to the new DGS. And there is no rationale for paying twice a contribution for the same risk. Unless this provision is amended, it imposes a significant cost on any crossborder re-organisation, specifically through “branchification”, as pointed out by the SSM President in September 2021.The amount to be transferred should be close to the total amount paid by the related credit institution (with the exception of extraordinary contributions and part of the contributions used for past interventions). Some technical elements regarding the calculation of the amount to be transferred could also be set by EBA guidelines.
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS the contributions due for the last 12 months preceding the change of DGS membership, with the exception of the extraordinary contributions referred to in Article 10(8).; | 3. Member States shall ensure that where a credit institution ceases to be member of a DGS and joins a DGS of another Member State, or if some of the credit institution’s activities are transferred to a DGS of another Member State, the DGS of origin shall transfer to the receiving DGS the contributions preceding the change of DGS membership, net of relative share in case of pay-out events, if any, occurred during the membership of the DGS, with the exception of the extraordinary contributions referred to in Article 10(8).; |
| Text proposed by the Commission | Amendment |
|---|---|
| 3b. In order to specify the methodology for calculating the contributions to be transferred in accordance with paragraph 3, the EBA shall draft Regulatory technical standards within 6 months from the entry into force of this regulation. |
| Text proposed by the Commission | Amendment |
|---|---|
| 3a. For the purposes of paragraph 3, Member States shall ensure that the DGS of origin transfers the amount referred to in that paragraph within 1 month from the change of DGS membership.; | 3a. For the purposes of paragraph 3, Member States shall ensure that the DGS of origin transfers the amount referred to in that paragraph within 3 months from the point on which the DGS is informed of change of DGS membership. |
From a practical point of view, a one-month period is often quite too short. Since the Information may not occur at the same time as the change, the period should not start until the DGS has been informed.
| Text proposed by the Commission | Amendment |
|---|---|
| The EBA shall issue guidelines specifying the circumstances in which designated authorities should approve the coverage of depositors at branches that have been set up in third countries by DGSs’ member credit institutions. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Member States shall ensure that credit institutions provide the information sheet referred to in paragraph 1 before they enter into a contract on deposit-taking and, subsequently, annually. Depositors shall acknowledge the receipt of that information sheet.; | 2. Member States shall ensure that credit institutions provide the information sheet referred to in paragraph 1 before they enter into a contract on deposit-taking; |
Annual information requirements and obtaining the acknowledgement of receipt of the information sheet by the depositor seems unnecessary burdensome.
| Text proposed by the Commission | Amendment |
|---|---|
| 2. Member States shall ensure that credit institutions provide the information sheet referred to in paragraph 1 before they enter into a contract on deposit-taking and, subsequently, annually. Depositors shall acknowledge the receipt of that information sheet.; | 2. Member States shall ensure that credit institutions provide the information sheet referred to in paragraph 1 before they enter into a contract on deposit-taking; |
Credit Institutions should not be obliged to obtain the acknowledgement of receipt of the information sheet by the depositor. They should also not have to provide the depositor with the information sheet every year. It should suffice that they provide the depositor with the information sheet once before they enter into a contract on deposit-taking. The information sheet does not provide a real benefit to the depositor, its distribution is very expensive and harmful to the environment and it leads to cumbersome user journeys online. In analogous processes, the mailing of the information sheet and the acknowledgement of receipt causes enormous costs (costs for mailing and/or expansion of IT systems as well as corresponding customer information; costs due to closure of corresponding deposit accounts in the event of non-confirmation; at least EUR 5 per customer) without in any way ensuring that the customers read the information sheet. Even if read by the depositor, the information is not of much use to him. In view of the similarity of the statutory deposit protection at all credit institutions, there are no better or worse protection alternatives. There is also no longer any need to apply for compensation; instead, the credit balance must be reimbursed automatically by the compensation scheme. There is even less of a need for depositors to receive this information anew every year. This regularly causes uncertainty and queries – customers ask their bank for an explanation of the letter or even outright demand the payment of the protected amount to themselves.
| Text proposed by the Commission | Amendment |
|---|---|
| 7a. Member States shall ensure that designated authorities, DGSs and credit institutions concerned inform depositors, including by a publication on their websites, of the fact that a relevant administrative authority has made a determination as referred to in Article 2(1), point (8)(a), or a judicial authority has made a ruling as referred to in Article 2(1), point (8)(b).; | 7a. Member States shall ensure that DGSs inform depositors, including by a publication on their websites, of the fact that a relevant administrative authority has made a determination as referred to in Article 2(1), point (8)(a), or a judicial authority has made a ruling as referred to in Article 2(1), point (8)(b). |
The DGS should be the authoritative source of information in such a case; the information by three different agencies causes unnecessary coordination effort without providing added value, on the contrary, it might lead to confusion among depositors.
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that, by 31 March each year, DGSs inform the EBA of the amount of covered deposits in their Member State on 31 December of the preceding year. By the same date, DGSs shall also report to the EBA the amount of their available financial means, including the share of borrowed resources, payment commitments and the timeline for reaching the target level in case of use of DGS funds. | 3. Member States shall ensure that, by 31 March each year, DGSs inform the EBA and the SRB of the amount of covered deposits in their Member State on 31 December of the preceding year. By the same date, DGSs shall also report to the EBA and the SRB the amount of their available financial means, including the share of borrowed resources, payment commitments and the timeline for reaching the target level following a disbursement of DGS’s funds referred to in Article 10(2). |
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Member States shall ensure that, by 31 March each year, DGSs inform the EBA of the amount of covered deposits in their Member State on 31 December of the preceding year. By the same date, DGSs shall also report to the EBA the amount of their available financial means, including the share of borrowed resources, payment commitments and the timeline for reaching the target level in case of use of DGS funds. | 3. Member States shall ensure that, by 31 March each year, DGSs inform the EBA of the amount of covered deposits in their Member State on 31 December of the preceding year. By the same date, DGSs shall also report to the EBA the amount of their available financial means, and the timeline for reaching the target level in case of use of DGS funds. |
| Text proposed by the Commission | Amendment |
|---|---|
| Member States shall ensure that the designated authorities notify the EBA, without undue delay, about all of the following: | Member States shall ensure that the designated authorities notify the EBA and the Single Resolution Board, without undue delay, about all of the following: |
| Text proposed by the Commission | Amendment |
|---|---|
| (b) whether any of the measures referred to in Article 11(2), (3) and (5) have been applied and the amount of funds used in accordance with Article 8(1) and Article 11(2), (3) and (5), and, where applicable and once available, the amount of funds recovered, the resulting cost for the DGS and the duration of the recovery process; | (b) whether any of the measures referred to in Article 11(2), (3) and (5) have been applied and the amount of funds used in accordance with Article 8(1) and Article 11(2), (3) and (5). |
| Text proposed by the Commission | Amendment |
|---|---|
| The notification referred to in the first subparagraph shall contain a summary describing all of the following: | deleted |
| (a) the initial situation of the credit institution; | |
| (b) the measures for which the DGS funds have been used; | |
| (c) the expected amount of available financial means used. |
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Member States shall ensure that the resolution authorities of the credit institutions which are a member of a DGSs provide that DGS, upon request, with the summary of the key elements of the resolution plans as referred to in Article 10(7), point (a), of Directive 2014/59/EU, provided that such information is necessary for the DGS and designated authorities to exercise the obligations referred to in Article 11(2), (3) and (5) and in Article 11e. | 6. Member States shall ensure that the resolution authorities of the credit institutions which are a member of a DGSs provide that DGS annually with the summary of the key elements of the resolution plans as referred to in Article 10(7), point (a), of Directive 2014/59/EU. |
With regard to paragraph 6, it should be specified that a summary of the resolution plan should not only be transmitted on request, but that a constant exchange of the necessary information should take place, in line with best practice.
| Text proposed by the Commission | Amendment |
|---|---|
| 6. Member States shall ensure that the resolution authorities of the credit institutions which are a member of a DGSs provide that DGS, upon request, with the summary of the key elements of the resolution plans as referred to in Article 10(7), point (a), of Directive 2014/59/EU, provided that such information is necessary for the DGS and designated authorities to exercise the obligations referred to in Article 11(2), (3) and (5) and in Article 11e. | 6. Member States shall ensure that the resolution authorities of the credit institutions which are a member of a DGSs provide that DGS once a year with the summary of the key elements of the resolution plans as referred to in Article 10(7), point (a), of Directive 2014/59/EU. |
| Text proposed by the Commission | Amendment |
|---|---|
| 2. By way of derogation from Article 11(3) of Directive 2014/49/EU, as amended by this Directive, and Articles 11a, 11b, 11c and 11e in relation to preventive measures, until [OP – please insert the date = 72 months after the date of entry into force of this Directive], Member States may allow IPS referred to in Article 1(1), point (c), to comply with the national provisions implementing Article 11(3) of Directive 2014/49/EU as applicable on [OP – please insert the date of entry into force of this Directive]. | 2. By way of derogation from Article 11(3) of Directive 2014/49/EU, as amended by this Directive, and Articles 11a, 11b, 11c and 11e in relation to preventive measures, until [OP – please insert the date = 36 months after the date of entry into force of this Directive], Member States may allow IPS referred to in Article 1(1), point (c), to comply with the national provisions implementing Article 11(3) of Directive 2014/49/EU as applicable on [OP – please insert the date of entry into force of this Directive]. |
| Text proposed by the Commission | Amendment |
|---|---|
| They shall apply those provisions from … [OP – please insert the date = 24 months after the date of entry into force of this Directive]. However, they shall apply the provisions necessary to comply with Article 11(3), as amended by this Directive, and Articles 11a, 11b, 11c and 11e in relation to preventive measures from … [PO – please insert the date = 48 months after the date of entry into force of this Directive]. | They shall apply those provisions from … [OP – please insert the date = 24 months after the date of entry into force of this Directive]. However, they shall apply the provisions necessary to comply with Article 11(3), as amended by this Directive, and Articles 11a, 11b, 11c and 11e in relation to preventive measures from … [PO – please insert the date = 36 months after the date of entry into force of this Directive]. |
| Text proposed by the Commission | Amendment |
|---|---|
| They shall apply those provisions from … [OP – please insert the date = 24 months after the date of entry into force of this Directive]. However, they shall apply the provisions necessary to comply with Article 11(3), as amended by this Directive, and Articles 11a, 11b, 11c and 11e in relation to preventive measures from … [PO – please insert the date = 48 months after the date of entry into force of this Directive]. | They shall apply those provisions from … [OP – please insert the date = 24 months after the date of entry into force of this Directive]. However, they shall apply the provisions necessary to comply with Article 11(3), as amended by this Directive, and Articles 11a, 11b, 11c and 11e in relation to preventive measures from … [PO – please insert the date = 36 months after the date of entry into force of this Directive]. |
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- Licensed CC BY 4.0.
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Cite as
European Parliament (2023). “AMENDMENTS 83 - 332 - Draft report Amending Directive 2014/49/EU as regards the scope of deposit protection, use of deposit guarantee schemes funds, cross-border cooperation, and transparency”. Text, 6 November 2023. docId ECON-AM-754693. EU Parl Watch Research. https://news.eu-parl.st-solutions.dev/texts/ECON-AM-754693 (retrieved 25 September 2026). Data: EP Open Data API: document record, https://data.europarl.europa.eu/api/v2/documents/ECON-AM-754693 (CC BY 4.0).
BibTeX
@misc{epw-text-econ-am-754693,
author = {{European Parliament}},
title = {{AMENDMENTS 83 - 332 - Draft report Amending Directive 2014/49/EU as regards the scope of deposit protection, use of deposit guarantee schemes funds, cross-border cooperation, and transparency}},
year = {2023},
date = {2023-11-06},
howpublished = {\url{https://news.eu-parl.st-solutions.dev/texts/ECON-AM-754693}},
url = {https://news.eu-parl.st-solutions.dev/texts/ECON-AM-754693},
urldate = {2026-09-25},
publisher = {EU Parl Watch Research},
note = {Text. docId ECON-AM-754693. Data: EP Open Data API: document record (CC BY 4.0)}
}