Opinion of the European Central Bank of 1 June 2010 on amendments to several provisions of the Law on banking (CON/2010/46)
Date: 2010-06-01
Institutions: European Central Bank
Subjects: Slovenia, State aid, bank deposit, guarantee, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 1 June 2010 

on amendments to several provisions of the Law on banking 

(CON/2010/46) 

Introduction and legal basis 

On  4  May  2010,  the  European  Central  Bank  (ECB)  received  a  request  from  the  Slovenian  Ministry  of 

Finance for an opinion on a draft law amending the Law on banking (hereinafter the ‘draft law’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 

Functioning  of  the  European  Union  and  the  third  and  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 law relates to Banka Slovenije 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 law 

1.1  The  draft  law  implements  provisions  of  several  directives  into  Slovenian  legislation  (Directives 
2009/111/EC2,  94/19/EC3,  2009/14/EC4  and  2010/16/EU5).  However,  the  consulting  authority 

mentions  in  its  consultation  request  that  the  draft  law  also  includes  a  number  of  provisions 
amending the current Law on banking6 that do not relate to transposition of directives. In line with 

Article 1(2) of Council Decision 98/415/EC, this opinion only covers the latter provisions. 

1.2  Several  provisions  of  the  draft  law  are  connected  with  the  rules  governing  the  Slovenian  deposit 

guarantee scheme as laid down in the Law on banking. It is an ex post financed scheme, with the 

necessary funds being provided by the participating credit institutions and, in certain cases, also by 

the Slovenian State. The draft law  clarifies the treatment of certain categories  of deposits, taking 

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OJ L 189, 3.7.1998, p. 42.  
Directive  2009/111/EC  of  the  European  Parliament  and  of  the  Council  of  16  September  2009  amending  Directives 
2006/48/EC,  2006/49/EC  and  2007/64/EC  as  regards  banks  affiliated  to  central  institutions,  certain  own  funds  items, 
large exposures, supervisory arrangements, and crisis management (OJ L 302, 17.11.2009, p. 97). 
Directive  94/19/EC  of  the  European  Parliament  and  of  the  Council  of  30  May  1994  on  deposit-guarantee  schemes 
(OJ L 135, 31.5.1994, p. 5). 
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 delay (OJ L 68, 13.3.2009, p. 3). 
Commission Directive 2010/16/EU of 9 March 2010 amending Directive 2006/48/EC of the European Parliament and of 
the Council as regards the exclusion of a certain institution from the scope of application (OJ L 60, 10.3.2010, p. 15). 
Zakon o bančništvu, published in Uradni list Republike Slovenije No 131/2006.  

 
 
 
 
                                                 
into account their nature and their holders and assigns Banka Slovenije certain new and modified 
tasks  relating  to  the  administration  of  the  scheme7.  In  addition,  certain  existing  provisions  of  the 

Law on banking which, as stated in the draft law’s explanatory memorandum, might give rise to 

concerns  regarding  monetary  financing  by  Banka  Slovenije  of  the  State’s  obligations  under  the 

scheme are amended.  

1.3  Pursuant to the Law on banking, credit institutions have established a system for the exchange of 

information on the credit standing of their clients. The draft law includes certain amendments with 

respect to the information to be entered and processed in the system and introduces, among other 

things, a ‘credit score’ indicating a client’s creditworthiness, which is determined on the basis of a 

common methodology. The draft law also includes a number of minor and editorial amendments to 

the Law on banking. 

2. 

General observation 

The  ECB  would  like  to  point  out  that  any  widening  of  Banka  Slovenije's  tasks  has  to  be  supported  by 

ensuring sufficient human and financial resources, both in terms of quantity and quality, so as to enable 

performance of these tasks without affecting Banka Slovenije’s capacity to carry out its European System 

of Central Banks-related tasks. 

3. 

Compliance with the prohibition of monetary financing 

3.1  Pursuant to the Law on banking in force today, as amended in the relevant part by an amendment to 
the Law on banking in 20088, which was not subject to a consultation procedure with the ECB, the 

Slovenian  State  shall  guarantee  repayment  of  (i)  guaranteed  deposits  held  at  a  bank  subject  to 

bankruptcy proceedings above the amount covered by the inter-bank deposit guarantee scheme; and 

(ii)  guaranteed  deposits up  to  the  abovementioned  amount  if  banks  with  their head  offices  in  the 
Republic of Slovenia cannot provide sufficient funds9. From the date of the initiation of bankruptcy 

proceedings, Banka Slovenije will assume on its own behalf and for the account of the Slovenian 
State  the  obligation  to  repay  such  guaranteed  deposits10.  These  provisions  imply  that  Banka 

Slovenije is obliged to repay the guaranteed deposits before obtaining the relevant funds from the 

guarantor,  i.e.  the  Slovenian  State.  This  raises  the  issue  of  compatibility  with  the  prohibition  on 

monetary financing under Article 123 of the Treaty, according to which the ECB and the national 

central  banks  (NCBs)  may  not,  inter  alia,  provide  overdraft  facilities  or  any  other  type  of  credit 

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These  tasks  include  the  adoption  of  implementing  measures,  monitoring  of  the  scheme’s  mechanisms,  processing  of 
information from participating institutions and informing depositors and the public about bankruptcy proceedings and the 
conditions for exercising the right to repayment of guaranteed deposits. 
Zakon o spremembah in dopolnitvah Zakona o bančništvu (ZBan-1B) (Uradni list Republike Slovenije No 109/2008).  
Article 313(1) and (2) of the Law on banking. 
Article 315(5) of the Law on banking. 

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facility  in  favour  of  the  public  sector11.  The  Law  on  banking  can be  understood  as  providing  for 

financing of the deposit guarantee scheme by Banka Slovenije, which would be incompatible with 
the monetary financing prohibition under Article 123 of the Treaty12. 

3.2 

In view of the above, the ECB welcomes the draft law according to which the Slovenian State will 

have  to  ‘provide  funds’  rather  than  only  a  ‘guarantee’  in  the  event  of  activation  of  the  deposit 
guarantee  scheme13,  while  the  provisions  obliging  Banka  Slovenije  to  provide  funds  for  the 

repayment of guaranteed deposits of insolvent banks, on its own behalf against a State guarantee, 
are removed14. As a consequence, any payouts by Banka Slovenije under Article 315(3) of the Law 

on  banking  will  always  be  made  using  funds  provided  by  participating  credit  institutions  (or 

obtained  by  realising  their  assets)  and,  if  necessary,  funds  provided  in  advance  by  the  Slovenian 

State. The ECB is of the view that these draft amendments establish an assurance that there will be 

no financing of the deposit guarantee scheme contrary to the abovementioned Treaty requirements. 

3.3 

In line with these draft amendments and for reasons of legal clarity, the ECB would recommend an 

alignment  of  the  wording  of  other  related  provisions  of  the  Law  on  banking  to  reflect  that  the 
Slovenian State is providing funds rather than a guarantee15. 

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

Done at Frankfurt am Main, 1 June 2010. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

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See  also  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  [now  Articles  123  and  125(1)  of  the  Treaty  on  the 
Functioning of the European Union] (OJ L 332, 31.12.1993, p. 1). 
National legislation providing for the financing by an NCB of a national deposit insurance scheme for credit institutions 
would  only  be  compatible  with  the  monetary  financing  prohibition  if  it  were  short  term,  addressed  urgent  situations, 
systemic stability aspects were at stake and decisions were at the NCB’s discretion; see the ECB Convergence Report of 
May 2010, p. 33. Relevant ECB opinions in this area are, e.g., paragraphs 11-14 of Opinion CON/2001/32; paragraphs 
11-13  of  Opinion  CON/2005/50;  paragraphs  2.1-2.3  of  Opinion  CON/2007/26;  paragraphs  2.2-2.8  of  Opinion 
CON/2008/5;  and  paragraph  3.2  of  Opinion  CON/2008/69.  All  ECB  opinions  are  available  on  the  ECB  website  at 
www.ecb.europa.eu. 
Article 63 of the draft law, amending Article 313(2) of the Law on banking, and Article 66 of the draft law, amending 
Article 316(1) of the Law on banking. 
Article 65 of the draft law. 
See, in particular, Article 66 of the draft law, amending Article 316(1) of the Law on banking, and its erroneous reference 
to a ‘guarantee’ in relation to Article 313(2) of the Law on banking. 

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