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Europe issues formal request to 10 member states on deposit guarantee schemes

The European Commission has formally requested that Belgium, Cyprus, Estonia, Greece, Italy, Luxembourg, Poland, Romania, Slovenia and Sweden fully implement the Deposit Guarantee Schemes Directive (DGSD).14 Dec 2015

Since 2010, EU legislation has protected all bank deposits up to €100,000 per depositor and bank through national schemes. All member states have implemented this initial version of the DGSD. However, an improved version of the DGSD was adopted in 2014 to improve protection for depositors and ensure all schemes are pre-funded. The 10 states named are running behind in implementing this for their national schemes, having missed the deadline of 3 July, the Commission said.

If the member states do not comply within two months, the Commission may decide to refer them to the Court of Justice of the EU, it said.

The Commission's longer-term aim is an EU-wide scheme, the European Deposit insurance scheme, to replace national schemes. The proposed EU scheme would be put in place in three stages, from re-insuring national deposit guarantee schemes to a co-insurance model with progressive increases in funding to EDIS, to a full European scheme by 2024.

However, a German government official told the Financial Times that the EU-wide scheme sets the "wrong priorities and guidelines" and would spread risk around the Eurozone rather than reduce it.