The Denmark Deposit Guarantee Scheme (DGS) is a financial safety net designed to protect depositors in the event of a bank failure. This scheme ensures that depositors’ funds in Danish banks are safe and accessible, thereby maintaining confidence in the financial system. Deposit insurance is crucial as it safeguards the interests of depositors, especially small savers, and mitigates the risk of bank runs, which can destabilize the economy.
The Danish DGS covers deposits up to DKK 750,000 (approximately EUR 100,000) per depositor per bank. This coverage applies to both individuals and companies with eligible deposits. The scheme is funded by the banks through regular contributions, ensuring that the DGS has sufficient financial resources to compensate depositors in case a bank is unable to meet its obligations.
The Danish Financial Supervisory Authority (Finanstilsynet) is responsible for the supervision and regulation of the DGS. The Guarantee Fund for Depositors and Investors (Garantiformuen) administers the DGS and handles the payout process in case a bank fails. The Guarantee Fund is a private, independent institution established under Danish law.
The organizational structure of the Guarantee Fund consists of a board of directors, a management team, and a secretariat. The board of directors is composed of representatives from the Danish Ministry of Business and Growth, the Danish Central Bank, and the financial industry. The management team and the secretariat handle the day-to-day operations of the fund.
Contact information for the Guarantee Fund for Depositors and Investors:
Danish Garanti Fund
Sankt Annæ Plads 13, 2. tv.
DK – 1250 Copenhagen K
Phone: +45 70 27 87 47