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Austria’s deposit guarantee scheme – resilient in uncertain times

Author

Listed:
  • Judith Eidenberger

    (Oesterreichische Nationalbank (OeNB), Financial Markets Analysis and Surveillance Division)

  • Katharina Steiner

    (Oesterreichische Nationalbank, Foreign Research Division)

Abstract

Austria’s deposit guarantee scheme (DGS) is multilayered, consisting of three separate schemes. Between 2020 and 2022, Austria’s DGS faced four payout events. Although its setup is rather complex and the payout events occurred in periods of exceptional macroeconomic uncertainty, Austria’s DGS has proved resilient, and depositors have remained confident. We identify three key aspects that helped maintain the credibility of Austria’s DGS: (1) a well-functioning setup and funding structure, (2) the efficient operational management of the payouts and (3) the superiority of the DGS in the creditor hierarchy and sound insolvency procedures.

Suggested Citation

  • Judith Eidenberger & Katharina Steiner, 2023. "Austria’s deposit guarantee scheme – resilient in uncertain times," Financial Stability Report, Oesterreichische Nationalbank (Austrian Central Bank), issue 46, pages 39-46.
    • Handle: RePEc:onb:oenbfs:y:2023:i:46:b:3
    as

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    File URL: https://www.oenb.at/dam/jcr:5d51ace7-b355-4884-8dbd-205b93b73d52/05-FSR-46_Austrias-deposit-guarantee.pdf
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    References listed on IDEAS

    as
    1. Daniel C. Hardy, 2014. "Bank resolution costs, depositor preference and asset encumbrance," Journal of Financial Regulation and Compliance, Emerald Group Publishing Limited, vol. 22(2), pages 96-114, May.
    2. Douglas W. Diamond & Philip H. Dybvig, 2000. "Bank runs, deposit insurance, and liquidity," Quarterly Review, Federal Reserve Bank of Minneapolis, vol. 24(Win), pages 14-23.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    deposit guarantee scheme; payout event; financial stability; systemic risk;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management

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