About HDIGF - Legal framework

Deposit insurance was introduced in Greece by law 2324/1995 (Government Gazette (GG) 146/A) which was based on Directive 94/19/EC (L. 135/31.05.1994) on “Deposit Guarantee Schemes (DGSs)”. With this law TEK (Hellenic Deposit Fund) was established, as a legal person of private law, by the Bank of Greece and the Hellenic Bank Association and supervised by the Minister of Finance. The coverage level amounted to 20,000 euro, the smallest allowed for by the Directive, whereas the repayment period was set at three (3) months.
With law 3746/2009 the Fund’s guarantee expanded to include the provision of investment services by credit institutions and the name of the organization was changed from TEK to TEKE (Hellenic Deposit and Investment Guarantee Fund). The new fund thus became a strong and reliable organization covering both deposits and investment services of credit institutions. As a result, the aforementioned law created two distinct groups of assets: the Deposit Cover Scheme and the Investment Cover Scheme.

In November 2008, in the first stages of the financial crisis, the coverage level was increased to 100,000 euro by law 3714/2008 (article 6, GG 23/A).

In 2009, in an attempt to tackle the effects of the financial crisis and to harmonize some aspects of deposit guarantee schemes (DGSs), Directive 2009/14/EC amended Directive 94/19/EC, with the main changes relating to the coverage level and the payout period. Specifically, The coverage level was harmonized at 100,000 euro and the maximum period in which compensation should commence was shortened to twenty (20) working days. Directive 2009/14/EC was transposed to Greek legislation with law 3775/2009 (GG 122/A).

The know-how gained during the financial crisis led to the necessity to establish new rules and procedures governing the establishment and operation of DGSs and contributed to the enactment of Directive 2014/49/EU (L.173/12.6.2014) on DGSs. With the aim to protect the majority of depositors and provide the same level of security, the coverage of the new Directive was harmonized at 100,000 euro per depositor, whereas for some categories of social purpose transactions and for a given time period a larger coverage is possible. The new Directive also reduced the payout period to seven (7) working days, enhanced the framework for depositor information and enforced a minimum level of assets a DGS should hold. Moreover, under the new framework, credit institutions’ contributions are based on the level of covered deposits and are risk-adjusted. The provisions of Directive 2014/49/EU were transposed to the Greek legal framework with law 4370/2016 (37/A). 

Law 4021/2011 (218/A) caused a number of amendments to law 3746/2009 (37/A) relating to the application of resolution measures to credit institutions facing financial difficulties prior to the activation of the payout procedure by TEKE. As a result, s resolution fund was established within TEKE (Resolution Scheme – RS), with the aim to financing the resolution measures of transfer order and the establishment of a bridge bank. 

Note that for the period between February 29, 2012 and December 31, 2014, the use of TEKE RS was suspended, in lieu of which the Hellenic Financial Stability Fund covered the cost of resolution measures.

In 2015, law 4335/2015 (87/A) transposed the provisions of Directive 2015/59/EU on bank recovery and resolution and governed the operation of the RS as the national resolution fund for credit institutions.