New regulation planned

Attack on savings deposit protection

Not only Austria, but also France and Germany have voiced fierce criticism of the EU's plans.(Bild: stock.adobe.com/Tobias Kaltenbach)

In Austria, savings deposits of up to 100,000 euros are protected even if a bank goes bankrupt; the institutions have set up deposit protection funds for this purpose. According to the EU plan, some of these funds could also be diverted to foreign bank insolvencies in future, leaving less for our savers if necessary.

Specifically, the EU Parliament's Economic Affairs Committee recently voted in favor of creating a Europe-wide deposit guarantee scheme. According to this, the respective national funds should transfer half of their capital to a common EU pot. If a bank goes bust in a member state and the money accumulated there is not enough to compensate savers, the European fund would have to step in and make up the difference.

The idea is to ensure that even major bankruptcies in one country do not trigger a domino effect and endanger the financial system as a whole. In this way, Brussels wants to push ahead with its long-standing plans for a "banking union". The danger, however, is that after a few such emergencies, the well-filled Austrian deposit guarantee scheme, for example, would be "wiped out" and domestic savers could no longer be fully compensated in the event of the insolvency of a financial institution in our country. But that's not the only poison in the proposal.