The German cooperative banks are considering adjusting their security scheme again. It should take the risks of individual financial institutions even more into account.
(Photo: imago images/photo booth)
Frankfurt The German Volks- und Raiffeisenbanken are about to reform their deposit insurance. “We want to further develop our security system in an evolutionary manner. We have now made suggestions that we want to discuss with our members,” said Daniel Quinten, board member of the industry association BVR, the Handelsblatt. “The system should become more risk-oriented overall.”
The BVR sent a circular with the proposed changes to the 740 cooperative banks at the end of last week. The newsletter “Finanz-szene” first reported on this.
The BVR protection scheme protects all customer deposits, including savings deposits, savings certificates and sight deposits, and is therefore fundamental to the self-image of the cooperative banks.
The general protection works by preventing bank insolvencies. In the event of an emergency, a bank that is in difficulty receives help from the guarantee system so that it can meet all its obligations.
Problems are often solved by a weak bank merging with a neighboring institute. Institution protection and deposit protection work in a similar way at the savings banks.
Three quarters of the more than 700 cooperative banks would have to agree
According to “Finanz-Scene”, it is also planned, among other things, that the confidentiality obligation associated with audits will apply not only to the guarantee scheme, the supervisory authority and the respective auditing association, but also to the bank concerned itself. In addition, the guarantee scheme at the banks should be faster than before intervene with the help of external auditors.
Some of the announced changes can be interpreted to mean that the BVR wants to monitor cooperative banks whose business models differ significantly from the average for the sector more closely. One of the unusual financial institutions is the VR-Bank Bad Salzungen Schmalkalden, which made headlines with football financing.
A three-quarters majority of the cooperative banks is required to change the statutes of the guarantee scheme. Voting will take place in mid-June.
The security system has been slightly modified regularly in recent years. Since 2004, the contributions that individual banks have to pay have been graded according to their risks. At that time it also became clear that a reform of the security system would not be a sure-fire success. At the first attempt, the changes did not find a majority 20 years ago. After an adjustment in 2009, the risks of various financial institutions were further emphasized in the protection scheme.
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