President Klaus Iohannis promulgated the law concerning deposit guarantee schemes and the Bank Deposit Guarantee Fund, the Presidential Administration reports cited by Agrepress. The main novelties refer to recognizing two administration regimes for bank deposit guarantee schemes, regulating the law of protective institutional systems and contractual schemes concerning guarantees, (...) regulating the procedure of official recognition of privately-managed deposit guarantee schemes by the National Bank of Romania as the authority designated to supervise such deposit guarantee schemes; introducing the option of deposit guarantee schemes from various European Union member states merging together; imposing an explicit supervision regime on continual bases by the National Bank of the activities of the privately-managed deposit guarantee schemes officially recognised in Romania.
The law says the Bank Deposit Guarantee Fund will continue to be a deposit guarantee scheme, administrator of the bank resolution fund as well as shareholder in a bridge loan institution. In order to preserve its functions, the Bank Deposit Guarantee Fund is crated into a publicly administered entity in its turn administered by the National Bank of Romania (BNR).
At the same time, Iohannis signed a decree promulgating a law on the recovery and resolution of credit institutions and investment companies, amending and supplementing pieces of legislation in the financial area reported news agency Agerpress.
The legal framework for the management of bank and finance crises established under this piece of legislation comprises three distinct stages: preparation, early intervention and bank resolution.
Resolution entails an intervention of the state authorities under expressly stated circumstances, with resolution being deemed of public interest.
The same piece of legislation designates the national authorities with resolution powers as follows: the National Bank of Romania for credit institutions and entities thereof that are subjected to consolidated oversight of the authority as an authority in charge with prudential supervision; the Financial Oversight Authority, for investment companies and entities thereof that are subjected to consolidated supervision by the authority as an authority in charge with prudential supervision.
The law also provides for the establishment of a bank resolution fund patterned on the already existing model in the national legislation for the bank restructuring fund, ordering that the resources of the fund shall reach 1 percent of the volume of covered deposits of the credit institutions authorised by BNR and do so by December 31, 2024.