EBA: Protection of depositors in branches of UK banks in the EU must be maintained despite Brexit
The European Banking Authority (EBA) recommends that EU countries’ deposit guarantee authorities ensure that depositors in branches of UK credit institutions in the EU remain protected in accordance with the Deposit Guarantee Schemes Directive also in case of a withdrawal of the UK from the EU with no ratified agreement in place. In an Opinion published by the EBA on 1 March 2019, the EBA assesses that the withdrawal of the UK from the EU is not likely to have an impact on the protection of deposits in the vast majority of banks operating in the EU.
As regards deposit guarantee, Brexit may have ramifications primarily on the protection for branches of UK banks in the EU and branches of EU banks in the UK. UK banks have no branches in Finland, and therefore Brexit does not directly affect the deposit guarantee for deposits in Finland.
The EBA also considers in its Opinion that potential impacts on the deposit guarantee for EU banks’ branches in the UK depend on the still-pending issue of whether the deposits fall within the EU or UK deposit guarantee scheme. Nordea is the only Finnish bank with a UK branch, and it will remain covered by the Finnish deposit guarantee scheme also after Brexit.
The Financial Stability Authority (FFSA) is responsible for deposit guarantee in Finland. The FFSA monitors the withdrawal of the UK from the EU within its remit in cooperation with other authorities and banks.