Government proposes Deposit Insurance Fund to manage Bank Resolution Fund and five‑year deadline for payouts
Draft law would split accounting between a Deposit Protection Fund and a Bank Resolution Fund and set a five‑year limit for insured payouts.
The Government has proposed amendments to the law governing the Deposit Insurance Fund that would place management of a separate Bank Resolution Fund under the same institution and introduce a five-year deadline for depositors to collect compensation after a bank licence is revoked.
Two separate funds under one manager
Under the draft changes the existing Deposit Insurance Fund would administer two distinct pools of money: the Deposit Protection Fund, used to reimburse customers when a bank fails, and a Bank Resolution Fund, intended to finance measures to stabilise banks that have run into serious trouble. The Government approved the changes on 13 October and sent them to the Assembly for consideration.
The proposal keeps the funds separate in accounting and purpose but places them under a single manager. The Bank Resolution Fund was already foreseen by a separate law adopted in 2023; the current amendments detail how it will be managed and how it will relate to the Deposit Insurance Fund.
The draft also states that resolution financing will primarily come from annual contributions by banks, supplemented by additional levies and other financing mechanisms if needed. The National Bank would have the authority to decide on using those resources to implement resolution measures such as selling parts of a bank, transferring assets and liabilities to another bank, or other steps that preserve core banking services.
As the draft puts it: "The funds of the Bank Resolution Fund are used exclusively for the purposes prescribed by the Bank Resolution Act. The Fund manages the Bank Resolution Fund in accordance with this law, taking into account the requirements of the Bank Resolution Act."
Importantly for depositors, the amendments introduce a five-year limit for claiming insured payouts. "The Fund's obligation to pay compensation ceases within five years from the date of finality of the decision from Article 4‑a paragraph 2 of this Law. Uncollected compensation funds, except funds with inheritance rights, are transferred to the funds of the Deposit Protection Fund." In practice, a depositor with €5,000 in a failed bank would have five years from the date the licence revocation decision becomes final to collect the payout; after that period the Fund would no longer be obliged to pay, except where inheritance rules apply.
The Government points to unresolved payouts recorded in the Fund's 2023 annual report: as of 31 December 2023, unpaid compensations totalled €8.27 million for 226,192 depositors. Most of that amount related to Eurostandard Bank (about €5.86 million for 124,296 depositors) and Macedonian Bank (about €2.27 million for 96,812 depositors). The Fund noted many unpaid claims at Eurostandard Bank were very small sums.
The maximum insured amount remains unchanged: up to €30,000 per person in a single bank. The draft amendments must complete the parliamentary procedure before taking effect.
Photo: press material from the event
