THE NEW EU DIRECTIVE (2014/49/EU) ON DEPOSIT GUARANTEE SCHEMES

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Section A:
The Directive in the context of the European Banking Union
1. The political agenda
1.1 The decisions of June 2012
The creation of a ‘European Banking Union’ (hereinafter the ‘EBU’) was a
very ambitious political initiative, which was tabled at the Euro Area Sum-
mit of 29 June 2012, amidst the current fiscal crisis in the euro area, which
became manifest in 2010.1 The main rationale behind this initiative is sum-
marised in the following sentence of the Summit’s Statement:
“We affirm that it is imperative to break the vicious circle between banks
and sovereigns.”2
The European Summit which was held concurrently on 28-29 June decid-
ed to invite the President of the European Council “to develop, in close col-
laboration with the President of the European Commission (hereinafter the
‘Commission’), the President of the Eurogroup and the President of the Eu-
ropean Central Bank (hereinafter the ‘ECB’), a specific and time-bound road
map for the achievement of a genuine Economic and Monetary Union”3
(hereinafter the ‘EMU’) in accordance with a relevant Report,4 submitted a
few days earlier (on 26 June) by the President of the European Council. One
of the four (4) elements of this Report was the creation of the EBU.5
1. For an evaluation of this crisis, see Eichengreen, Feldmann, Liebman, von Hagen and
Wyplosz (2011), pp. 47-64, and Stephanou (2012).
2. Euro Area Summit Statement, 29 June 2012, first paragraph, first sentence, available
at:
3. European Council Conclusions, 28/29 June 2012, EUCO 76/12, paragraph 4(b), avail-
able at:
131388.pdf.
4. Van Rompuy Report (2012): Towards a Genuine Economic and Monetary Union,
EUCO 120/12. The final relevant Report was submitted in December 2012.
5. Ibid., Section II.1.
The other three (3) elements are the establishment of:
• an intergrated budgetary framework (‘European Fiscal Union’),
• an intergrated economic policy framework (‘European Economic Union’), and