Wednesday, 10 July 2013

Questions (68)

Michael McGrath

Question:

68. Deputy Michael McGrath asked the Minister for Finance the total amount of deposits covered by the State across banks and credit unions under the deposit protection scheme; the number of financial institutions participating in the scheme; and if he will make a statement on the matter. [33841/13]

View answer

Written answers (Question to Finance)

The Deposit Guarantee Scheme covers deposits by individuals in participating credit institutions. All deposit-taking credit institutions in Ireland are required by law to participate in the Deposit Guarantee Scheme. The scheme currently covers all 395 credit unions in Ireland and 37 banks and building societies. Further information can be found on the Central Bank of Ireland’s website at http://www.centralbank.ie/paycurr/paysys/dgs/pages/about.aspx. The Deposit Guarantee Scheme is funded by a charge on the credit institutions participating in the scheme. The cost of compensation payments is met from the balances in the Deposit Protection Account. In the event of the Deposit Protection Account being insufficient to fund a compensation event, any difference is made up using advances from the Central Bank or the State; the remaining participating institutions are then responsible for the repayment of these advances.

The Central Bank of Ireland (“the Bank”) is responsible for the operation of the Deposit Protection (Guarantee) Scheme - DGS. I am advised by the Bank that it currently holds data on total deposits held by financial institutions. The Bank has explained that while it holds data relating to total deposits, not all of the deposits are covered by the DGS scheme (e.g. only amounts up to €100,000 are currently covered and there are various exclusions from coverage, such as large companies and inter-bank deposits).

The Bank advises me that it is currently working with Credit Institutions in order to receive data on actual coverage under the Deposit Guarantee Scheme. Formal powers to request this data are in the Central Bank (Supervision and Enforcement) Bill 2011. The Central Bank (Supervision and Enforcement) Bill 2011 has passed all stages in the Oireachtas and is currently with the President for signature. I anticipate that the bill will be signed by the President in the coming days and following this the Central Bank will make the necessary arrangements to ensure that such information is fully accessible to it where required.