Opinion of the European Central Bank of 5 June 2009 on measures to increase the effectiveness of the deposit-guarantee scheme (CON/2009/51)
Date: 2009-06-05
Institutions: European Central Bank
Subjects: Romania, bank deposit, credit institution, financial stability, guarantee, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 5 June 2009 

on measures to increase the effectiveness of the deposit-guarantee scheme  

(CON/2009/51) 

Introduction and legal basis 

On 25 May 2009 the European Central Bank (ECB) received a request from Banca Naţională a României 

(BNR)  for  an  opinion  on  a  draft  emergency  ordinance  amending  and  supplementing  Government 

Ordinance No 39/1996 regarding the setting up and the operation of the Deposit Guarantee Fund in the 

banking system (hereinafter the ‘draft emergency ordinance’). 

The  ECB’s  competence  to  deliver  an  opinion  is  based  on  Article  105(4)  of  the  Treaty  establishing  the 

European Community and the third and the sixth indents of Article 2(1) of Council Decision 98/415/EC 

of 29 June 1998 on the consultation of the European Central Bank by national authorities regarding draft 
legislative  provisions1,  as  the  draft  emergency  ordinance  relates  to  BNR  and  to  rules  applicable  to 

financial institutions insofar as they materially influence the stability of financial institutions and markets. 

In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central 

Bank, the Governing Council has adopted this opinion. 

1.  

Purpose of the draft emergency ordinance 

The draft emergency ordinance aims to implement into Romanian legislation Directive 2009/14/EC of the 

European  Parliament  and  of  the  Council  of  11  March  2009  amending  Directive  94/19/EC  on  deposit-
guarantee  schemes  as  regards  the  coverage  level  and  the  payout  delay2  and  also  to  adopt  the  measures 

necessary  to  ensure  a  higher  level  of  effectiveness  of  the  Romanian  deposit-guarantee  scheme.  This 

opinion  is  not  a  comprehensive  assessment  of  the  provisions  of  the  draft  emergency  ordinance 

implementing Directive 2009/14/EC. Instead, it only focuses on those provisions of the draft emergency 

ordinance that go beyond implementation of Directive 2009/14/EC.  

The draft emergency ordinance amends Government Ordinance No 39/1996 regarding the setting up and 

the operation of the Deposit Guarantee Fund in the banking system (hereinafter ‘GO No 39/1996’). The 

Deposit  Guarantee  Fund  (hereinafter  the  ‘Fund’),  as  Romania’s  officially  recognised  deposit-guarantee 

scheme,  guarantees  deposits  and  the  payment  of  compensation  to  depositors  in  accordance  with  the 

1  
2  

OJ L 189, 3.7.1998, p. 42.  
OJ L 68, 13.3.2009, p. 3. 

 
 
 
 
                                                 
conditions  and  limits  laid  down  by  GO  No  39/1996.  The  draft  emergency  ordinance  will  make  certain 

changes  to  the  way  that  the  Fund  operates.  In  particular,  it  will:  (i)  increase  the  maximum  coverage 

ceiling  from  the  equivalent  in  Romanian  lei  of  EUR  20 000  to  the  equivalent  in  Romanian  lei  of 

EUR 50 000; (ii) reduce the payout delay, following expiry of a transitional period, to 20 working days; 

(iii) introduce  the  obligation  for  credit  institutions  to  inform  depositors  adequately  if  a  deposit  is  not 

guaranteed  by  the  Fund;  (iv)  introduce  a  specific  mechanism  for  BNR  as  the  competent  authority  to 

declare  that  deposits  are  unavailable;  (v)  introduce  the  obligation  for  the  Fund’s  members  to  keep 

permanently  complete  and  accurate  records  of  all  information  necessary  to  determine  the  value  of  the 

compensation due to each covered depositor; and (vi) strengthen the Fund’s capacity to pay compensation 

on time. 

2. 

General observations  

2.1  The  ECB  takes  this  opportunity  to  reiterate  that,  when  implementing  Directive  2009/14/EC  or 

otherwise  amending  the  legal  framework  for  operation  of  national  deposit-guarantee  schemes, 

Member States should act in a coordinated manner to avoid significant differences in national legal 
frameworks having a counterproductive effect and creating distortions in global banking markets3. 

2.2  The  ECB  also  emphasises  that  the  funding  arrangements  for  national  deposit-guarantee  schemes 

must, inter alia, comply with the  monetary financing prohibition laid down in the Treaty, and in 

particular with the prohibition on national central banks providing overdraft facilities or any other 
type of credit facility within the meaning of Article 101 of the Treaty4, as specifically considered in 
past ECB opinions concerning draft national legislation5 and in the ECB’s Convergence Reports6.  

3.  

Specific observations 

3.1   Under the draft emergency ordinance the Fund may be financed by means of borrowings from the 
Romanian  Government7.  In  specific  circumstances  and  where  the  Fund’s  financial  resources  are 

insufficient to pay compensation, the Government, through the Ministry of Finance, will lend the 
necessary amount to the Fund8. The draft emergency ordinance also states that the loan repayment 

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4  

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7  
8  

See paragraph 2.1 of ECB Opinion CON/2008/70 of 18 November 2008 at the request of the Council of the European 
Union  on  a  proposal  for  a  Directive  of  the  European  Parliament  and  of  the  Council  amending  Directive  94/19/EC  on 
deposit-guarantee schemes as regards the coverage level and the payout delay (OJ C 314, 9.12.2008, p. 1). 
Interpreted  in  line  with  Council  Regulation  (EC)  No  3603/93  of  13  December  1993  specifying  definitions  for  the 
application of the prohibitions referred to in Articles 104 and 104b(1) of the Treaty (OJ L 332, 31.12.1993, p. 1). 
See, for example, paragraph 3.1 of ECB Opinion CON/2009/10. 
See, for example, the ECB’s Convergence Report of December 2006, p. 30. 
See Article I point 7 of the draft emergency ordinance. 
See Article I point 13 of the draft emergency ordinance. 

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conditions will be set by Government decision. In this context, the ECB notes that such conditions 
should be in accordance with a coordinated framework within the European Union9.  

3.2   The  ECB  considers  that  the  draft  emergency  ordinance  should  establish  a  framework  that  is 

consistent with the need to enable payouts in the prescribed time period. In this respect, the ECB 

refers  to  Article  10(1)  of  Directive  94/19/EC,  which  requires  that  ‘[d]eposit-guarantee  schemes 

shall be in a position to pay duly verified claims by depositors in respect of unavailable deposits’. 

This means that it is primarily the responsibility of the national deposit-guarantee scheme to ensure 

that guaranteed deposits are made available to entitled depositors in an orderly and timely manner, 
whatever  the  payment  system  chosen10.  In  line  with  its  recent  opinions11,  the  ECB  reminds  the 

consulting  authority  that  reducing  delays  in  payouts  of  guaranteed  deposits  can  strengthen 
depositor confidence, which plays a key role in the effectiveness of deposit protection schemes12. 

At  the  same  time,  it  is  essential  that  a  pragmatic  approach  is  taken  to  introducing  the  necessary 
reduction  in  payout  delays,  thereby  preserving  the  credibility  of  deposit-guarantee  schemes13. 

Finally, attention should be drawn to the importance of establishing efficient operational processes 

for  verifying  claims  and  reimbursing  depositors,  as  well  as  ensuring  that  sufficient  sources  of 

funding are available. 

3.3  The ECB further notes that the draft emergency ordinance provides for a specific mechanism for 

declaring  deposits  unavailable  and  entrusts  BNR  with  the  assessment  of  such  a  measure.  This 

represents  an  extension  of  BNR’s  regulatory  and  supervisory  powers.  In  this  context  the  ECB 

restates  its  general  position  that  ‘Member  States  may  not  put  their  national  central  banks  in  a 

position  where  they  have  insufficient  financial  resources  to  carry  out  their  European  System  of 

Central Banks (ESCB) or Eurosystem-related tasks, as applicable’.  

This opinion will be published on the ECB’s website.  

Done at Frankfurt am Main, 5 June 2009. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

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11  
12  
13  

See, by analogy, paragraph 6 of ECB Opinion CON/2008/58 regarding a State guarantee set as a ‘complement to and in 
addition to’ an existing deposit-guarantee scheme. 
See paragraphs 3.5 and 3.6 of ECB Opinion CON/2009/31. 
See, for example, paragraph 2.2. of ECB Opinion CON/2009/20. 
See, for example, paragraph 2.2 of ECB Opinion CON/2008/70. 
See Opinion CON/2008/70. 

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