Dáil Éireann Debate, Tuesday - 3 December 2013
57. Deputy Pearse Doherty asked the Minister for Finance the total funds available to the Central Bank of Ireland in its deposit guarantee scheme to compensate potential claims by depositors of failed banks. [51330/13]
View answerThe Financial Services (Deposit Guarantee Scheme) Act 2009 provides for the operation of the Deposit Protection Account (DPA). Credit Institutions are required to maintain a balance in the DPA equivalent to 0.2% of their total deposits (subject to a minimum of €50,000 for each bank or building society). The Central Bank of Ireland is responsible for the operation of the Deposit Protection (Guarantee) Scheme (DGS). I am advised by the Central Bank that the current balance in the DPA is €369 million.In the event of a credit institution being unable to repay deposits, the Central Bank is authorized to make compensation payments to eligible depositors to a maximum of €100,000 per eligible depositor per institution. The cost of compensation payments is charged against the balance in the DPA.
In the event that the cost of compensation exceeds the balances in the DPA, the 2009 Act provides for the Central Bank to be reimbursed from the Central Fund within 3 months, subject to the approval of the Minister for Finance. Subsequently, credit institutions would be required to replenish the DPA and to repay the Minister for amounts advanced to cover the immediate cost of compensation. The Minister is authorized to specify the period for repayments and the interest rate chargeable.
