Protection system

Introduction

Protection schemes

Any deposit held within a credit institution in any European Economic Area country is protected up to €100.000 per person per establishment.

Any investment deposit held with a Belgian investment company is protected in case of failure up to €100,000 per person and per institution.

Any life insurance policy (TAK 21) held with a Belgian insurance company is protected in case of failure up to €100,000 per person and per institution.

Any financial instrument held with a credit institution or investment firm from a Member State of the European Economic Area is protected in case of failure up to €20,000 per person and per institution.

For more information on which deposit protection scheme or investment protection scheme protects your deposit, investment deposit, life insurance or financial instrument, you should contact your financial institution.

Resolution funding

The Resolution Fund's mandate is to provide funding for preventive measures to prevent a solvent institution from failing. The Resolution Fund is an emergency fund and aims to prevent banks from failing by using its resources to pre-fund resolution proceedings, at the request of the Resolution College. This task is shared with the Single Resolution Fund (SRF), a European emergency fund.

When your institution is no longer able to reimburse your deposits or is declared bankrupt, the Guarantee Fund will reimburse you within 15 working days. From 2021, the period will be gradually reduced to 7 working days on January 1^st, 2024.

The Guarantee Fund reimburses up to €100.000 per person per establishment. Some deposits, however, benefit from a temporarily high protection.

Which institutions operating in Belgium are protected by the deposit guarantee?

The deposit guarantee offered is applicable to deposits held by:

• Credit institutions under Belgian law;
• Investment and stockbroking firms under Belgian law
• Branches of credit institutions whose parent company is located in a country that is not a member of the European Economic Area and does not have protection at least equivalent to that of the Guarantee Fund;
• Mutual fund management companies and management companies of OPCA provided that they are authorized to provide the individual portfolio management investment service.

Are excluded:

• Branches of credit institutions headquartered in a European Economic Area country. These establishments are protected by the guarantee system of the country concerned.
• Branches of credit institutions whose registered office is located in a country which is not a member of the European Economic Area and which has protection at least equivalent to that of the Fund. These establishments are protected by the guarantee system of the country concerned.

Which assets are covered by the deposit guarantee?

• All deposits placed on one of the following accounts regardless of the currency:
  • Current accounts
  • Savings accounts
  • Term accounts
• Deposits of funds held on behalf of investors pending allocation to the acquisition of financial instruments or pending restitution;
• Nominative or dematerialized cash certificates registered in personal accounts;
• Bonds or other bank debt securities issued or made before July 2^nd, 2014.

Are excluded:

• The assets of companies in the financial sector (banks, insurance, etc.);
• The assets of the State and public authorities;
• Assets involved in the fight against terrorism and anti-money laundering
• Bonds or other bank debt securities issued or made since July 2^nd, 2014;
• Electronic money and funds received in exchange for electronic money
• Deposits which can only be released in accordance with national law for the sole purpose of repaying a loan contracted for the purchase of a private property from a credit institution or other institution holding the deposit.

Do you have the right to the €100.000 guarantee?

Yes, if you own a protected product and you are not part of the exclusions.

Whether you are:

• A private individual, minor, guardian or represented by a third party, regardless of your residence or nationality;
• An association, civil society, foundation or other group of any kind;
• A company regardless of its status or size.

What should you do if your financial institution fails?

• Have an account opened at another financial institution
• Communicate this account number to the Guarantee Fund via the MyMinfin portal; once identified, you will be able to select your institution in the “My Wealth” section and thus communicate the account number on which you wish to receive your refund.

The refund is automatic. You have no further action to take with the Guarantee Fund.

Warning: without the communication of an account number, the Guarantee Fund will not be able to make your refund.

How is your refund calculated ?

All your protected assets (principal, interest and accessories) of all your bank accounts (regardless of the nature or the name of the accounts) within the same financial institution are added together.

The sum will then be converted into euro and, if necessary, limited to €100.000. This limit could however be increased if one of your deposits benefits from temporarily high protection.

When your insurance company is no longer able to reimburse you or is declared bankrupt, the Guarantee Fund will reimburse you within 3 months extendable 3 times by the Guarantee Fund. The reimbursement amounts to a maximum of €100.000 per person and per institution.

Which life insurance institutions are members of the Guarantee Fund?

All insurance companies under Belgian law approved as life insurance insurer in branch 21.

The protection of life insurance contracts is not subject to European harmonization. Therefore, any protection applicable to a life insurance contract subjects to foreign law or concluded with a life insurance company under foreign law, is subject to this foreign law.

What are the protected products ?

Life insurance contracts with guaranteed return, subject to Belgian law and falling into branch 21.

Are excluded:

• Contracts relating to supplementary pensions and the tax regime of these and certain additional social security benefits (group insurance, etc.);
• Contracts relating to supplementary pensions for the self-employed (TPA …).

Are you entitled to this guarantee?

Yes, if you are the holder of a life insurance policy governed by Belgian law and falling into branch 21, regardless of your residence or nationality.

What should you do if your insurance company fails?

Send us, within two months of the bankruptcy, the form, duly completed, which will be made available on our website or on request with a copy of your identity card.

You have the choice between:

• A payment of the surrender value of your policy to a bank account of your choice (in this case, any taxes will be levied before the refund);
• A transfer of your contract to another insurance company (this allows you to avoid the payment of taxes). You must then attach to your application a tax certificate provided by the new insurance company.

Warning: to avoid the payment of taxes, this new contract must have the same tax advantages as the one for which you request the transfer.

What is the amount of your refund?

It is equal to the surrender value of your life insurance policy at the time of the bankruptcy of your insurance company, possibly reduced by taxes if applicable, and limited to €100.000 per person per insurance company.

This protection applies to financial instruments that a client has deposited with his institution.

The institutions that belong to the protection system are:

• Credit institution;
• Stockbroking firms;
• Asset management and investment advisory firms;
• Management companies of collective investment institutions, which are also authorized to conduct individual portfolio management.

However, it is important to draw attention to the important legal protection a client benefits from for the securities ​​he has entrusted to his financial institution. Indeed, the customer remains the legitimate owner of his titles and has a right of direct claim on them. This means that the securities must be returned by the curator and therefore can never fall into the bulk of the assets of a possible bankruptcy.

In the event that this client is no longer able to recover his securities due to the bankruptcy of the depositary, he may appeal to the protection system for the loss he has suffered. An intervention on the part of the protection system should only be considered if, after the return of all available securities, customers would not have been able to recover some of their assets. Such cases should only occur in the event of administrative errors or other irregularities.

The return of the bills deposited will be in the form of a transfer to a securities account opened with another institution, regardless of the value of these securities at the time of the bankruptcy of the depositary. Indeed, the protection system does not offer any hedging against a possible depreciation of these securities.

Because of these strong guarantees, the risk that a client's claim remains open vis-à-vis the failing institution, after the return of all available securities, is very limited. For these reasons, the maximum amount of additional coverage offered by the protection system remains fixed at €20.000 per person and per institution. If, moreover, the client concerned had not yet been fully indemnified, he would retain on the financial institution a claim for which he will be able to claim the allocation of a liquidation or bankruptcy dividend.

The precise conditions that must be fulfilled in order to be able to appeal to protection are mentioned in the Intervention Regulation.

This regulation determines which beneficiaries are eligible for compensation, the nature of the assets to be compensated, the method of calculating compensation and the procedures to be followed.

If you wish to consult the previous annual reports, you can contact:

 

PRESIDENT	Alexandre De Geest
MEMBERS	Public authorities representatives	Credit institutions and investment firms representatives
	Jean Hilgers	Karel Van Eetvelt
	Dirk Ooms	Dirk De Cort
	Manuela Carpano	Patrick Tans
	Christel de Vleeschauwer	Dirk Wouters
	Michèle Casteleyn	Luc Aspeslagh
		Eric Struve de Swielande
	Substitute	Substitute
	Maarten Lombaert	Tom Boedts
		Raf Rollier
		Wim Descamps
		Véronique Leleux
GOVERNMENT COMMISSIONER	Luc Keuleneer

 

The Resolution fund

The operation of the Resolution fund The Resolution fund uses its intervention reserve for the pre-financing of the resolution regime in the context of a resolution procedure concerning a firm that is not liable to contribute to the Single Resolution Fund (= Single Resolution Fund, or SRF for short), at the request of the Resolution College.

Furthermore, it collects the contributions due from the contributing firms to the Single Resolution Fund and transfers them to the Single Resolution Fund.

Following types of firms have to join the Resolution fund:

1° the firms liable to contribute to the Single Resolution Fund (this includes credit institutions under Belgian law and listed companies under Belgian law that are subject to the consolidated supervision of the parent company exercised by the European Central Bank in accordance with the SSM Regulation).

2° the firms that are not liable to contribute to the Single Resolution Fund (this includes branches established in Belgium of credit institutions or third-country investment firms as well as listed companies under Belgian law that are not subject to the consolidated supervision of the parent company exercised by the European Central Bank in accordance with the SSM Regulation).

The Resolution fund is financed by annual contributions from its member firms. The Resolution fund transfers the contributions paid by firms that are not liable to contribute to the Single Resolution Fund to the Treasury. The amounts transferred to the Treasury by the Resolution fund constitute the intervention reserve for the pre-financing of the resolution scheme.

The intervention reserve for the pre-financing of the resolution scheme should reach the target level of 1 % of the covered deposits of the non-contributing institutions to the Single Resolution Fund by 31 December 2024.

The Resolution fund shall only make use of its intervention reserve for the pre-funding of the resolution scheme in the context of a resolution procedure concerning a company, at the request of the Resolution College of the National Bank of Belgium (NBB), for one or more of the following purposes:

• to guarantee the assets or liabilities of a firm under resolution, its subsidiaries, a bridge institution or an asset management vehicle;
• to provide loans to a firm in resolution, its subsidiaries, a bridge institution or an asset management vehicle;
• to purchase assets from a firm in resolution;
• to contribute to a bridge institution and asset management vehicle;
• for compensating shareholders or creditors of a firm in accordance with applicable laws;
• to make a contribution to a firm in resolution, instead of writing off or converting claims of certain creditors when the internal reinforcement tool is applied and the Resolution College decides to exclude certain creditors from the scope of the internal reinforcement tool.