ECB: Completing the Banking Union with a European Deposit Insurance Scheme: who is afraid of cross-subsidisation?

11 April 2018

This paper provides five analytical contributions to the discussion on the establishment of a European Deposit Insurance Scheme (EDIS)

On 24 November 2015, the European Commission published a proposal to establish a European Deposit Insurance Scheme (EDIS).

The proposal provides for the creation of a Deposit Insurance Fund (DIF) with a target size of 0.8% of covered deposits in the euro area and the progressive mutualisation of its resources until a fully-fledged scheme is introduced by 2024.

This paper investigates the potential impact and appropriateness of several features of EDIS in the steady state.

The main findings are the following:

The key drivers behind these results are:

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