- December 3, 2019
- Category: Publications
The European Commission just published the study on “Options and national discretions under the Deposit Guarantee Scheme Directive and their treatment in the context of a European Deposit Insurance Scheme”, to which Milieu contributed.
The Directive is a central piece of the Banking Union. It strengthens depositor protection by requiring faster pay-outs, more robust funding and increases information disclosure. The DGSD also contains about 22 national options and discretions (NODs), which may be applied on the basis of national circumstances. The objectives of the study were to assess both the transposition of each NOD across the EU Member States and the experience in practice, and their relevance under the proposed European deposit insurance scheme (EDIS) in the context of the negotiations in the European Parliament and the Council. In this context, the study provides an overview of the current use of NODs in the Member States and contributes to the discussion regarding their treatment under EDIS, by formulating policy recommendations, including in view of the impact on EDIS in terms of financial exposure and administrative burden. The study highlights the important differences between the Member States in terms of the transposition of the NODs into their national law and their use in practice. Among others, the study recommends to keep a high level of coverage for depositors, to further harmonise the national schemes to strengthen the level playing field and develop the use of both national DGS and EDIS for financing early intervention and alternative measures.