Deposit Guarantee Scheme
The fundamental objectives of the deposit guarantee scheme are to protect investors and to maintain their confidence in the banking system. A sound and effective deposit guarantee scheme is one of the vital conditions for the maintenance of financial stability in a country.
The deposit guarantee is an area that is harmonised at EU level. The new Directive 2014/49/EU of the European Parliament and of the Council on deposit guarantee schemes has been in force since July 2014, and was transposed into Slovenian law by the Deposit Guarantee Scheme Act (ZSJV), which entered into force on 12 April 2016.
The directive:
provides for a deposit guarantee of up to EUR 100,000 for eligible depositors,
the deadline for the repayment of guaranteed deposits is seven working days,
further increases the requirement to inform depositors of the guarantee before entering into an agreement in connection with a deposit,
additionally sets out a requirement for Member States to establish a separate guarantee fund, which must have at its disposal sufficient assets to provide for the smooth repayment of covered deposits.
Covered deposits amounted to EUR 26.6 billion as at 31 December 2024.
The deposit guarantee scheme in Slovenia is operated by Banka Slovenije. This means that:
we are responsible for setting up and managing the deposit guarantee fund,
we collect the banks’ regular and ad hoc contributions to the deposit guarantee fund, and enter into agreements on other forms of financing for the fund,
we put in place, vet and update the procedures and arrangements for the repayment of covered deposits (including stress testing),
we conduct activities for using the deposit guarantee fund to finance measures of bank recovery or compulsory dissolution, i.e. measures that ensure that depositors retain access to covered deposits,
we supervise members of the deposit guarantee scheme (all banks and savings banks established in Slovenia, and branches of third-country banks included in the system in Slovenia) with regard to their fulfilment of the obligations of membership.
In connection with the exercise of the powers and tasks related to the deposit guarantee scheme, Banka Slovenije works with the deposit guarantee authorities of other EU Member States, the resolution authorities and other relevant authorities of EU Member States.
Informing of depositors
Commercial banks and savings banks must display information about the deposit guarantee scheme that they are covered by on their publicly accessible website and in a clearly visible position in all premises where they transact with customers. The information must state the following:
the amount and scope of the guarantee,
which deposits are not covered by the guarantee,
the deadline for the repayment of covered deposits,
the currency of repayment (euros), and
the contact information for the deposit guarantee scheme.
More detailed information is available at Banka Slovenije.
Notices
Deposit guarantee fund
Banka Slovenije established a special deposit guarantee fund at the end of 2016 on the basis of the Deposit Guarantee Scheme Act (ZSJV). The fund is financed by contributions from banks and savings banks established in Slovenia. The fund is used to make repayments of deposits covered by guarantee, and to finance resolution or compulsory winding-up measures to ensure that depositors are able to access their covered deposits.
By law, the assets of the fund may be used for the following:
repaying covered deposits,
financing resolution or compulsory winding-up measures by means of which the guarantee of access to covered deposits is maintained for depositors, in accordance with regulations governing the resolution and compulsory winding-up of banks,
covering costs in connection with the repayment of covered deposits,
covering the costs of managing the fund,
covering borrowing costs referred to in points 3 and 4 of the first paragraph of Article 30 of the ZSJV.
The target level of the fund is 1.5% of the sum of all deposits covered by guarantee in the Republic of Slovenia. The target level of the fund will be reached by 31 December 2030.
In the event of the deposit guarantee fund not having sufficient funds to repay covered deposits, the banks would have to provide additional funds via extraordinary contributions, and the law also provides for the possibility of a short-term loan to be provided to the fund by the government, and a liquidity loan to be provided by Banka Slovenije subject to adequate collateral.
Investment policy and management fees
Banka Slovenije sets the deposit guarantee fund’s investment policy to ensure diversified investments with a low level of risk, and provides for the requisite availability of the fund’s investments for the repayment of covered deposits. The Governing Board of Banka Slovenije has established the general framework of the deposit guarantee fund’s investment policy, including the range, calculation, and billing of the fund’s management fees, through the Regulation on the investment policy and management fees of the deposit guarantee fund.
Since 1 January 2019, Banka Slovenije has managed the fund’s assets jointly with the assets of the bank resolution fund, in accordance with the aforementioned regulation.
FAQs and answers about the deposit guarantee scheme
The deposits of private individuals, private individuals pursuing registered business activities, sole traders and legal entities (corporates) are covered by the deposit guarantee scheme.
In the case of sole traders and other individuals independently pursuing registered business activities, these are individuals who use the same tax number for private purposes and business purposes, and under the law may only hold a single account for both purposes. Even in the case of potentially separate deposits, all the deposits of entities of this kind are therefore combined and treated together, i.e. per person, not per account.
IMPORTANT:
The deposits of the following depositors are not covered by the deposit guarantee scheme:
1. deposits in bearer form, including deposits for which the bank has not obtained the requisite information for the identification of the de facto beneficial owner by the day of the issue of the decision on unavailability,
2. deposits by banks and investment firms and other financial institutions,
3. deposits by insurance corporations, reinsurance corporations and insurance holding companies,
4. deposits by collective investment undertakings,
5. deposits by pension funds and pension companies,
6. deposits by governments and central banks, and deposits by entities that are direct or indirect users of the state budget, and
7. deposits by local authorities and deposits by direct and indirect users of the budgets of local authorities.
The total stock of claims that a deposit holder (depositor) holds against a particular bank or savings bank, that derives from the positive balances in the depositor’s accounts and that the bank must repay to the depositor in accordance with law and contracts is classed as a deposit covered by the guarantee up to EUR 100,000.
In particular these are the funds that a depositor holds at a bank on the basis of a current account agreement, a savings account agreement or a cash deposit agreement, or a certificate of deposit or a treasury bill when issued as a registered security.
The covered deposit is calculated on the cut-off date for the calculation of the guarantee, and may not exceed EUR 100,000 including the interest accruing by the aforementioned date.
We recommend that depositors provide their banks with all the information necessary to identifying the beneficial owners of deposits, and should update such information regularly.
Important
The law stipulates that a depositor’s claims against a bank are not classed as a deposit when they have one of the following attributes:
they arise out of financial instruments (unless it is a savings product for which there is an appropriate certificate registered to a name and that was in existence on 2 July 2014),
the principal is not repaid at nominal value,
the principal is repaid at nominal value only if there is a guarantee, surety or other similar guarantee agreement from a bank or third party,
they are classed as a debt security of the bank or arise out of the bank’s own acceptances and promissory notes,
pursuant to an agreement or regulations they may be used exclusively for the repayment of the depositor’s liabilities to the bank,
they can be included in the bank’s own funds calculation in accordance with Regulation (EU) No 575/2013 with regard to their attributes.
The Deposit Guarantee Scheme Act stipulates that covered deposits are to be repaid in euros. When a depositor’s deposit is denominated in another currency, it is converted into euros at the Banka Slovenije exchange rate on the reference date for the calculation of the guarantee.
A custody account is an account opened by a particular authorised person for the account of one or more persons as beneficial owners, whereby the funds in the account are treated separately from the authorised person’s other funds by law.
In accordance with the fifth paragraph of Article 7 of the Deposit Guarantee Scheme Act (ZSJV), the proportion of funds in a custody account pertaining to an individual beneficial owner are treated as part of the beneficial owner’s deposits, provided that information to identify the beneficial owner has been submitted to the bank. If information about the beneficial owners of funds in a custody account has not been reported to the bank, the custody account is treated as a deposit in bearer form for the purposes of the aforementioned law.
In accordance with the sixth paragraph of Article 7 of the ZSJV, funds in a custody account that pursuant to regulations are at the disposal of a particular person as statutory representative or administrator for the account of a community that has been established on the basis of regulations and does not have independent legal personality, irrespective of the previous paragraph, are classed as claims of the community up to the amount of coverage referred to in the first paragraph of Article 10 of the ZSJV.
Example:
Article 42 of the Housing Act stipulates that the building manager of a multi-residence building must ensure that all contributions to the sinking fund by communal owners are managed in a separate current account. The building manager opens a separate account for the sinking fund in their own name for the account of the communal owners of the multi-residence building.
A sinking fund account opened by the building manager for communal owners is classed as a special custody account referred to in the sixth paragraph of Article 7 of the ZSJV. The beneficial owner in this case is the community, where the individual members do not hold the individual right to demand repayment of the funds; instead the right pertains exclusively to the community as a whole. The individual communal owners cannot be treated as beneficial owners in connection with a sinking fund that is administered by the building manager in a separate account; instead the beneficial owner of these funds is the community of communal owners of the particular multi-residence building. Therefore for the purposes of the deposit guarantee under the ZSJV there is no need to identify the individual communal owners as would be the case for other custody accounts; instead identification of the community suffices.
The funds in the separate account opened by the building manager for the purposes of the sinking fund are therefore classed as a deposit whose beneficial owner is the individual community of communal owners of the particular multi-residence building. The deposit is covered by a guarantee in the amount of EUR 100,000.
The funds in the separate sinking fund account of the particular community of communal owners are treated separately from their building manager’s own deposits and other funds administered by the building manager for other communities of communal owners. In the event of the activation of the deposit guarantee scheme, the repayment would be made to the building manager as the signatory of the account for the community of communal owners.
A building manager who provides building management services for several multi-residence buildings must keep separate accounting records for the sinking funds of each multi-residence building. If a building manager holds several separate sinking fund current accounts with the same bank, each for a community of communal owners, the funds in each of the accounts are covered by guarantee as an individual deposit up to the amount of EUR 100,000. If a building manager holds a single current account with a bank for administering the sinking funds for various multi-residence buildings, for the purposes of the deposit guarantee the account may be considered a custody account for the funds of multiple beneficial owners (i.e. the community of communal owners). In accordance with the fifth paragraph of Article 7 of the ZSJV, the (combined) funds in a custody account of this kind that belong to an individual community as the beneficial owner are treated as an independent deposit by that community, and are guaranteed up to the amount of EUR 100,000. Information allowing for the identification of individual communities of communal owners (of a particular multi-residence building) whose funds are combined in the custody account needs to be submitted in timely fashion to the bank, together with information about the amount of funds to which the individual community is entitled. If information allowing the identification of individual communities has not been submitted to the bank, their funds are not covered by the deposit guarantee scheme. Conversely, if a building manager opens several current accounts to administer the sinking fund for a community of communal owners of a single multi-residence building, the guarantee up to EUR 100,000 applies to the community of communal owners of that multi-residence building, as the funds are treated as a single deposit whose beneficial owner is the community of communal owners of the particular multi-residence building.
No. The sole exception is if the liabilities to the bank were past-due on or before the reference date for the calculation of the guarantee, and the liabilities may be netted against the depositor’s claim under the covered deposit in accordance with the applicable contracts or regulations. In this regard the important provision of the law is that banks must inform the depositor before the conclusion of the contract whether their liabilities to the bank may be netted against the claim under the repayment of the covered deposit.
Example:
A person holds a current account with a bank in which there is EUR 3,500 and holds a savings account at the same bank containing EUR 90,000 and a loan from the same bank in the amount of EUR 80,000. In this case the covered deposit at the bank in question is EUR 93,500 (EUR 90,000 + EUR 3,500). The loan, i.e. the amount of the depositor’s liabilities to the bank, is not deducted from the savings, and has no impact on the amount of the covered deposits, except in the cases stated above.
The law stipulates that in the deposit guarantee scheme, up to an amount of EUR 500,000, i.e. above the amount of EUR 100,000, funds eligible for guarantee, are those, that are a direct result of:
the purchase or sale of residential real estate (including the young family’s subsidy for first-time homeowners from the national housing fund scheme),
claims payments from social insurance, health insurance or life insurance,
disability benefit payments,
payments of compensation in connection with criminal offences,
payments of cash assistance for natural and man-made disasters (with the exception of assistance paid in connection with business activities),
payments of compensation for wrongful conviction and imprisonment, cash compensation for non-material damage and compensation for victims of criminal offences (with the exception of compensation for loss of earnings),
claims payments from property insurance for damage to personal property,
payments of solidarity benefit and similar assistance in the event of death, maintenance payments on the basis of a court ruling or maintenance agreement, and maintenance substitutes,
payments of termination benefits in the event of retirement or redundancy.
The aforementioned payments will be received in full by the depositor in the event of the failure of the bank, provided that they were transferred to the depositor no more than six months before the issuance of Banka Slovenije’s decision on the unavailability of deposits.
Yes. Deposits paid into any bank or savings bank established in Slovenia are covered by the guarantee under the deposit guarantee scheme in Slovenia.
Deposits held by a depositor at different banks are not summed in the calculation of the covered amount. The amount of the guarantee is determined for the deposits held by the depositor at each individual bank.
Deposits at Member State banks that provide banking services in Slovenia via a branch or directly are covered by the deposit guarantee scheme in the Member State in which the bank is established, given that all deposit guarantee schemes for deposits in EU Member States offer the same essential conditions with regard to the guarantee.
Only one branch of a Member State bank accepts deposits in Slovenia.
A bank that is merging with another bank must inform its depositors accordingly at least one month before the merger. It must warn them that each depositor’s deposits will be aggregated as a result of the bank merger, and could therefore exceed the maximum level covered by the guarantee (EUR 100,000). A depositor whose aggregate deposits at the merged bank exceed the amount of coverage may, irrespective of contractual provisions and without additional costs, request the repayment of an eligible deposit from the bank, including all interest and other benefits accruing by the date of repayment. The depositor may exercise this request within three months of receiving notice of the merger.
ANNUAL INFORMATION: Banks provide information about the deposit guarantee scheme to depositors at least once a year.
REGULAR BALANCE STATEMENTS: The law also stipulates that the information as to whether the claims are covered by the guarantee under the deposit guarantee scheme must be stated in the regular statement of the balance of the claims against the bank. Reference to a website where detailed information about the deposit guarantee scheme can be found must also be included.
PRIOR TO CONCLUSION OF A DEPOSIT AGREEMENT: The bank must provide information to the depositor about the deposit guarantee scheme before the conclusion of the deposit agreement. In the form agreed for the conclusion of the agreement, the depositor must confirm that the information has been provided. The bank must provide the information in written form should the depositor so request.
How are depositors and the public informed that a particular bank is in difficulties, and that the deposit guarantee scheme will be triggered?
The deposit guarantee scheme is activated on the basis of a Banka Slovenije decision on deposit unavailability, which is published by Banka Slovenije:
on the website of AJPES, the Agency for Public Legal Records and Related Services (www.ajpes.si),
on the Banka Slovenije website (www.bsi.si),
in at least two daily newspapers with national circulation.
Yes. A notice is issued to depositors. Within five working days of the publication of the decision on deposit unavailability, Banka Slovenije must publish a notice to depositors on its website (www.bsi.si) and on the AJPES website (www.ajpes.si), stating the following:
the name of the repayment bank, i.e. the bank to which Banka Slovenije as the operator of the deposit guarantee scheme will transfer the funds for repaying depositors and via which depositors will obtain access to their covered deposits,
the date from which depositors will be able to access their deposits,
information that deposits will be repaid in euros, and the exchange rates at which claims in other currencies will be converted,
the minimum amount of a deposit that will be repaid (deposits that are lower in value than the administrative costs of repayment and in relation to which there has been no transaction in the last 24 months will not be repaid),
any charges to be made to depositors by the repayment bank after the end of the stipulated period (Banka Slovenije will stipulate the maximum amount that the repayment bank may charge depositors in the first six months; after six months the bank will apply its own prices),
instructions to depositors on how to exercise their rights in connection with the covered deposit, and
information for depositors with regard to registering their claims in bankruptcy proceedings.
How long will it take before depositors of a failed bank have their covered deposits again at their disposal?
The deposit guarantee system pays the coverage of the guaranteed deposit no later than seven working days after the cut-off date for calculating the guarantee (the date of publication of the Bank of Slovenia's decision on the unavailability of deposits on the website of the Agency of the Republic of Slovenia for Public Legal Records and Services (AJPES)).
Important:
In certain cases the deadline periods for the repayment of covered deposits are counted from other dates.
Example: When a deposit is the subject of a legal dispute in judicial proceedings, the deadline period is counted from the day that the relevant settlement or decision becomes res judicata, or when it is unclear on the basis of the available information whether the depositor has a right to repayment, the deadline period is counted from the day when the depositor provides the requisite evidence of eligibility. (For more, see Article 17 of the ZSVJ).
Yes. The law stipulates that repayment is not made if no transaction relating to the deposit has been made in the 24 months before the reference date for the calculation of the guarantee, and at the same time its value is lower than the administrative costs that would be incurred in making repayment.
The depositor is also not entitled to the repayment of a covered deposit from the deposit guarantee scheme if the deposit has arisen out of transactions in connection with which there has been a conviction for the criminal offence of money laundering or terrorist financing.
The repayment of covered deposits up to the amount of EUR 100,000 is undertaken by Banka Slovenije ex officio, and there is thus no need to submit a request.
Depositors claiming the repayment of amounts in excess of EUR 100,000 need to submit a request. Banka Slovenije informs depositors of how to submit requests of this kind, and by which deadlines.
Banka Slovenije designates the repayment bank via which deposits are repaid to depositors of a bank that is no longer capable of covering its deposits. Depositors are informed of the identity of the repayment bank in a notice.
As the operator of the deposit guarantee scheme, Banka Slovenije transfers the funds for deposit repayments to the repayment bank from the deposit guarantee fund, by deadlines to ensure that deposit repayment requests are met (for more, see the answer to the question of how long it will take before depositors of a failed bank have their covered deposits again at their disposal). At the same time it provides information on deposits and depositors covered by the guarantee, and instructions.
One of Banka Slovenije’s tasks, as the operator of the deposit guarantee scheme, is regular testing of its functioning, where Banka Slovenije reviews the capabilities of all stakeholders in the deposit repayment process.
Yes. The law explicitly stipulates that all data on individual depositors that Banka Slovenije has at its disposal for the purposes of operating the deposit guarantee scheme is confidential.