Schleweis: “Third pillar of banking union has already been completed”

The German Savings Banks Association (DSGV) takes a critical view of the European Stability Mechanism’s (ESM) detailed proposal for the future development of the banking union and the development of a collectivised and centralised European deposit insurance scheme in several stages. “The third pillar of the banking union has already been sufficiently completed. The new Deposit Guarantee Schemes Directive provides equal protection for every euro in customer deposits in all the EU Member States. We are opposed to any initiatives that are aimed at centralising and collectivising insurance benefits because this would mean that risk and liability would diverge”, said Helmut Schleweis, President of the German Savings Banks Association (DSGV).

In the DSGV’s view, the establishment of a centralised and collectivised European deposit insurance scheme is neither necessary nor appropriate. The question that arises is what problems such a centralised scheme is actually expected to solve. Problem-solving approaches should always be subsidiary – that is problems should be solved at the lowest level – and they must be appropriate. In any event, the functionality of the institutional protection schemes in Germany should be preserved in view of the fact that the institutional protection scheme serves as the basis of the regulatory setup and the cooperative concept of the Savings Banks Finance Group.