The implementation act changes the definition of deposits eligible for compensation, introduces new reporting requirements and extends information requirements.
The revised Deposit Guarantee Schemes Directive (Directive 2014/49/EU of the European Parliament and of the Council of 16 April 2014, DGS Directive) provides new and largely harmonized rules at EU level for deposit protection. It aims to protect as many deposits as possible in favor of comprehensive consumer protection and in the interest of financial stability. The provisions form one of the pillars of the European Bank Union and are connected closely to the regulations on bank recovery and resolution.
The law transposing the DGS Directive : is expected to be published in the Federal Law Gazette soon and will enter into force entirely on 3 July 2015. It replaces the existing Deposit Guarantee and Investor Compensation Act (Einlagensicherungs- und Anlegerentschädigungsgesetz – EAEG) by the new Deposit Guarantee Act (Einlagensicherungsgesetz – EinSiG) and the Investor Compensation Act (Anlegerentschädigungsgesetz – AnlEntG). Due to the new regulations, depositors in principle will have a right of compensation for their covered deposits up to an amount of EUR 100,000 and in certain cases even up to an amount of EUR 500,000. This would be the case e.g. with deposits which were made due to the sale of private property for the period of up to six months after the credit on their account.
The newly introduced definition of “deposits eligible for compensation” of EinSiG based on the specifications of the DGS Directive is not completely congruent with the current notion of deposits eligible for compensation pursuant to the current EAEG. For example, in future deposits eligible for compensation will be also deposits denominated in foreign currencies and not only deposits in the currency of a Member State of the European Union or in Euros. Furthermore, also deposits of larger companies, currently excluded from compensation, will be eligible for compensation. In addition, in future set-off or retention rights of the CRR-credit institution will not be considered.
Credit institutions are obliged to flag their deposits eligible for compensation so that they can be identified for each depositor immediately. There are also future reporting obligations with regard to the so-called “covered deposits“, which are determined in reference to the deposits eligible for compensation. The first report on the amount of covered deposits with the reference date 31 July 2015 has to be delivered already on 1th September 2015 due to a provision of the (European) Commission Delegated Regulation No. 2015/63. It could be therefore appropriate to review the existing internal bank system used to survey the deposits eligible for compensation and to adapt them if necessary.
In addition, new information obligations towards depositors are introduced. E.g., the reception of the new “depositor information template” must be confirmed by the depositors. In this context, the internal processes related to the customer service might have to be adjusted to fulfill the new requirements.