On 9 October 2016 entered into force the Act on the Bank Guarantee Fund, Deposit Guarantee Scheme and Resolution (the Act on BFG).

Under the new Act on BFG the Fund has gained new powers enabling to carry out a resolution action. The Fund may start the resolution process, if any opportunities to recover a bank, credit union or investment firm by early intervention measures undertaken by the PFSA are exhausted, and the resolution action is necessary in the public interest.

As part of resolution BFG will be able to:

  • sell a failing institution, in whole or in part,
  • establish a bridge institution – a special entity to which good assets and liabilities (deposits) of an institution at risk will be transferred,
  • write down certain obligations of a threatened institution in order to cover its losses or convert them into shares, so as to restore its capital base and allow continuity of its operations (i.e. bail-in)
  • transfer doubtful assets to an entity specialized in the management of such assets.

The new Act has slightly changed existing rules deposit guarantees.

The deadline for the disbursement of the guaranteed funds by the BGF has been shortened from 20 to 7 working days.

The guaranteed amount remained unchanged at the PLN equivalent of EUR 100 thousand. In certain special cases, the guarantee limit may be higher.

This applies in particular to the situation when the funds in the account came from: the sale of a house or apartment unrelated to the business activity, acquisition of inheritance, the payment of the sum insured under life insurance agreement further to the death of the insured person or reaching the specific age by that person, the payment of accident insurance, the payment of severance payment, the retirement or disability severance payment or performance of distribution of property following the expiry of matrimonial property.

Regardless of the above situations, the limit is increased by the granted compensation and by some damages – in its entirety.