FAQs

A moratorium is the stage before a compensation event is determined, i.e., before a bank becomes insolvent. It means that the bank is not allowed make any payments (e.g. withdrawals or transfers) or sell any assets. The bank may only continue to accept customer payments intended to repay debts. Customers must continue to repay loans.

A compensation event occurs when BaFin determines that the bank
• is no longer able to pay back deposits,
• can no longer meet its obligations from securities transactions or
• if the moratorium is in place for longer than six weeks.

The EdB may only begin compensating depositors once BaFin has determined the compensation event. When this happens, the EdB immediately informs all protected customers that BaFin has determined the compensation event and what the next steps are.

The compensation process consists of the following steps:

• The Federal Financial Supervisory Authority (BaFin) determines the compensation event. 
• The EdB identifies the depositors and verifies their entitlement to compensation.
• The EdB informs customers automatically by post and requests their bank details and a copy of proof of identity. 
• If all the required documents are in order, the EdB transfers the money to the account specified by the customer.
• If the bank is also a member of the Deposit Protection Fund of the Association of German Banks (BdB), the fund settles the compensation. This means that during the compensation process, the Deposit Protection Fund will contact the customer.
More information here.
 

No. The EdB will contact the affected customers directly and inform them what happens next.

There are two exceptions:

• Amounts that temporarily exceed the normal coverage level (up to 500,000 euros) must be proven in writing to the EdB. This could be, for example, due to the sale of private real estate or from severance pay. This money must have been transferred to the account within the past few months. The customer must inform the EdB of these exceptional cases.
• Claims from securities transactions must be registered within one year of BaFin determining the compensation event.

You will get your money back via the EdB within seven working days of BaFin determining the compensation case. How long it takes precisely will depend, among other things, on the number of customers and the internal organisation of the bank.

If the EdB does not receive a response from the customers it has notified, their right to claim compensation expires after five years.
Customers must register claims from securities transactions at the EdB within one year of BaFin determining the compensation event. 
More information is available here.

Deposits of more than 100,000 euros in Germany are often protected through voluntary deposit guarantee schemes. For example, many private banks are members of the Deposit Protection Fund of the Association of German Banks (BdB). 
Alternatively, customers may also assert their claims for amounts above 100,000 euros in the insolvency proceedings.

Yes, during a moratorium or compensation event, you must continue to pay off your loans.