Confirmed at EU level: Revised directives on deposit insurance and bank recovery and resolution bring changes. The aim is greater client comfort.

Prague, 6 May 2026 - The revision of the directives on deposit insurance and bank crisis management¹ enters into force on 10 May 2026. Within two years, i.e. by 11 May 2028, these revisions must also be reflected in Czech legislation.

New deposit insurance rules bring a number of benefits for bank clients

Probably the most significant change is the increase in the coverage limit for so-called temporarily high balances, i.e. funds that a bank client obtains, for example, from the sale of residential property, the settlement of marital property, inheritance or insurance payouts. Currently, increased balances are insured up to EUR 200,000 (which is twice the standard deposit insurance limit) for a period of 3 months from the moment they are credited to the client’s account (provided the client does not dispose of the funds). The new rules increase this limit to EUR 500,000 and protect the client’s funds for a period of 6 months. “We consider this a welcome change, as, for example, during the payout of compensation following the failure of Sberbank CZ, we saw that the current limit equivalent to EUR 200,000 no longer reflects reality,” explains Renáta Kadlecová, Managing Director of the Financial Market Guarantee System.

Another welcome change is that in certain situations, funds held in different accounts within the same bank will not be aggregated for the purposes of the deposit insurance limit. This will apply in cases where the client has no real possibility to influence the choice of the bank in which their funds are held. If a client entrusts funds to a financial institution (e.g. an investment firm), which then places those funds with a bank, or if a client deposits funds into an escrow account held by a lawyer or a notary, each such account within the same bank will have a separate limit of EUR 100,000.

“If a client has deposits of EUR 90,000 in their own account and an investment firm places EUR 50,000 with the same bank on behalf of that client, under the current framework the statutory deposit insurance limit of EUR 100,000 would already be reached and EUR 40,000 would be above the limit. Under the new rules, a separate limit will apply to the client’s own deposits and a separate limit to deposits placed by the investment firm in the same bank. In this example, the client would be entitled to compensation in the total amount of EUR 140,000,” describes Renáta Kadlecová.

Clients will also newly have the option to collect compensation for their deposits for a period of 5 years, instead of the current 3 years.

What does not change and remains the same:

The basic coverage limit for deposits held with financial institutions remains at EUR 100,000. At present, this is sufficient and, according to data from the European Banking Authority, it covers 96% of depositors in the EU and 98% of depositors in the Czech Republic.
The payout of compensation starts within 7 working days from the moment the Czech National Bank determines that a financial institution is unable to meet its obligations.

Changes to the BRRD directive – Crisis management framework:

If a financial institution encounters difficulties, it does not necessarily mean that it must cease operations and that the payout of deposit compensation will be initiated. In some cases, the situation can be resolved by other means set out in the so-called crisis management framework. This framework allows, where it is in the public interest, to ensure the continuity of the bank’s critical functions and thereby avoid significant adverse effects on financial stability. A key consideration for the application of resolution tools is in particular preventing the spread of the crisis, protecting public funds and protecting clients covered by deposit insurance.

The aim of the revision is to ensure that bank failures can be addressed quickly, effectively and with minimal impact on clients and the economy. The new rules expand the ability of the Czech National Bank to use resolution tools not only for large systemic banks, but also for smaller institutions.

For bank clients, this primarily means greater certainty that even in the event of a bank’s difficulties, access to basic services, such as account management or payment services, will be maintained. Instead of a bank’s liquidation and the payout of insured deposits, solutions enabling the continuation of the bank’s operations, for example through transfer to another bank, may now be used more frequently.

An important criterion for the use of these tools is the so-called public interest in maintaining the bank’s operations. This is assessed based on whether a bank’s failure could disrupt financial stability, undermine client confidence or interrupt essential banking services – including at a regional level.

The revision also preserves the key principle that losses are borne first by the bank’s shareholders and creditors, not taxpayers. The possibilities for using the resources of the Deposit Insurance Fund in resolution are also expanded, but only under clearly defined conditions and to a limited extent.

The new framework thus strengthens the ability of the financial system to respond to bank distress in a timely manner and to minimise its impact on clients and the economy as a whole.

¹On 20 April 2026, the following Directives of the European Parliament and of the Council (EU) were published in the Official Journal of the European Union: 2026/804 of 30 March 2026, amending Directive 2014/49/EU as regards the scope of deposit protection, the use of funds of deposit guarantee schemes, cross-border cooperation and transparency; and 2026/806 of 30 March 2026, amending Directive 2014/59/EU as regards early intervention measures, conditions for resolution and the financing of resolution actions, and Directive 2014/24/EU as regards valuation services for resolution purposes.