Ljubljana, 26 September (STA) - The government has proposed raising the target size of the central bank-managed deposit guarantee fund, which compensates depositors in the event of a bank failure, from the current 0.8% to 1.5% of all guaranteed deposits in Slovenia by the end of 2030. The scheme currently guarantees up to EUR 100,000 per depositor per bank, or more in some cases.
Additional changes to the deposit guarantee scheme act, proposed on Thursday, envisage that in cases when the deposit guarantee fund's resources prove insufficient during a bank failure, funds from the resolution fund, established under the bank recovery and resolution act, could also be used.
The continued operation of the resolution fund is being addressed in a separate amendment to the bank recovery and compulsory winding up act, which the government approved last week.
"This will significantly reduce the risk of being unable to secure the funds for deposit payouts within the legal time-frame in the event of a bank or savings bank's bankruptcy, which is crucial for maintaining public confidence in the stability and resilience of the banking system," the Finance Ministry said.
Slovenia's deposit guarantee system in place includes all banks and savings banks based in the country, as well as, under certain conditions, branches of non-EU banks that have obtained authorisation to operate in Slovenia.
