The European Forum for Deposit Insurers’ (EFDI) main objective is to contribute to the stability of financial systems by enhancing the role of, and promoting European and International co-operation in deposit insurance and investor compensation.
On 20 April 2018, the EFDI published two non-binding guidance papers:
- Pay-out in 7 working days. The Deposit Guarantee Scheme Directive (DGSD) requires Deposit Guarantee Schemes (DGSs) to compensate depositors of a failed bank within 7 working days after deposits have become unavailable. The compensation needs to be made available without a request to the DGS being necessary. The guidance paper concludes that a DGS complies with the requirement to make available the repayment amount within 7 working days if, without any previous action to be taken by the depositor and within 7 working days: (i) the DGS informs the depositor that the compensation amount has been made available or mails the financial instrument containing the compensation to the depositor; and (ii) the depositor has the immediate opportunity to finalise the repayment process upon receiving the notification or the mailing containing the financial instrument; and
- Deposit guarantee schemes investment policy. The guidance paper proposes a set of detailed recommendations for various aspects of the investment policy DGSs have to pursue in their regulatory and institutional environment: design of governance, selection of asset classes and asset allocation, risk considerations, holistic analysis of the portfolio, definition of investment constraints, selection of external asset managers and management style, conflicts of interest, indicators, monitoring and stress-testing.
