For its review, EBA conducted a survey among national competent authorities. A total of 30 out of 36 DGSs (at the time of the survey) in the European Economic Area responded. Additionally, the EBA examined 39 cases of DGS interventions since 2015, where DGSs used their funds to reimburse depositors or to support the restructuring of an institution by issuing a guarantee.
The changes EBA introduced include:
- updating the minimum weights of the different risk categories and core risk indicators to better cover the risk to DGSs. For example, the weighting for capital risk was increased to 20% (from 18%), but the weight for liquidity and funding was reduced to 15% (from 18%),
- implemented a change to the formula determining the risk adjustment factor of each member institution. This should ensure a constant link between the DGS contributions and the specific risk of a bank,
- further specification ensuring the connection of the amount of covered deposits and a credit institution’s contributions to a DGS,
- clarifications on re-fund, following the use of DGS funds and
- including the option for DGSs to use a stock-based approach to raising contributions, which may incentivize banks to reduce their risk level even after the DGS was fully funded.
The revised guideline for calculating contributions to DGSs will apply from 3 July 2024.
For inquiries please contact:
RBI Regulatory Advisory
Raiffeisen Bank International AG | Member of RBI Group | Am Stadtpark 9, 1030 Vienna, Austria | Tel: +43 1 71707 - 5923