Removal of the Eligible Liabilities Guarantee (ELG) Scheme

1. What is the ELG?

The Government introduced a guarantee of bank liabilities on the 30th September 2008, for a period of 2 years. The purpose of this guarantee was to protect customer deposits for amounts over €100,000 (amounts under €100,000 are guaranteed by the Deposit Guarantee Scheme). When the guarantee of bank liabilities expired on 29th September 2010 the ELG Scheme took it’s place.

The Government announced that they will be ending the ELG Scheme at midnight on the 28th of March 2013.

2. Why are the government ending the ELG Scheme?

The ELG Scheme was originally introduced to restore financial stability in Ireland.

The good news is, the latest European Banking Authority stress tests showed all banks covered by the scheme surpassed their capital ratio requirements as at the end of June 2012, which is why the scheme is now ending at midnight on the 28th March 2013.

The withdrawal of this scheme will also help to bring Ireland in line with other European countries in terms of the level of deposit protection that is provided to its customers.

3. What does this mean for you and your Deposit?

As you may already know, there is another scheme in place, which protects your deposit up to a maximum of €100,000 (or €200,000 for joint accounts) called the Deposit Guarantee Scheme (DGS) and is operated by the Central Bank of Ireland.

• This scheme guarantees Deposits of up to €100,000 per depositor, per institution, be it a bank or credit union.
• This Deposit Guarantee Scheme is permanent and currently, has no planned end date.
• The €100,000 threshold per institution is in line with the rest of the EU and is set down in EU law.
• Most deposits in Ireland will continue to be guaranteed under the existing statutory €100,000 Deposit Guarantee Scheme (DGS).

4. Some helpful questions and answers

(a) I have 4 accounts with permanent tsb – which ones are covered under the Deposit Guarantee scheme and which ones are covered under the ELG Scheme?

• Amounts up to €100,000 - Currently if the sum of the balances on your 4 accounts is less than or equal to €100,000 (or €200,000 in the case of joint accounts), then the total amount is fully covered under the Deposit Guarantee Scheme. This will not change.
• Amounts over €100,000 - If the sum of the balances on your 4 accounts is greater than €100,000 (or €200,000 in the case of joint accounts), then the amount that exceeds these thresholds is covered under the ELG Scheme until it ends or until their next maturity date, if in a fixed term deposit account.

(b) Will permanent tsb write to me about changes to the ELG Scheme?

No. Just like when the ELG Scheme was introduced you did not receive any notification, similarly when it ends you will not receive any letter from permanent tsb. Ahead of any change in the end date, the Minister of Finance will make an announcement outlining the changes to the ELG Scheme. Notice of the changes will be placed in the national press and media.

(c) I am a customer with account balances of less than €100,000; does the closure of the ELG Scheme affect me?

No. If your deposit and/or current account balance per institution is less than or equal to €100,000 (€200,000 for joint accounts) then the expiry of the ELG Scheme does not effect you, as you will still be covered under the DGS.

You can find out about this scheme at www.centralbank.ie orwww.nca.ie/nca/deposit-guarantee-scheme.

(d) What types of permanent tsb deposits are covered by the DGS & ELG Schemes?

Deposits held in demand, notice, fixed, foreign currency and current accounts.

(e) What does the possible end of the ELG Scheme mean for deposits covered by the Deposit Guarantee Scheme?

The ending of the ELG Scheme will have no effect on, or implications for, the Deposit Guarantee Scheme (DGS). The Deposit Guarantee Scheme is completely separate to the ELG Scheme.