Deposit Guarantee Scheme Croatia

Information Leaflet – A Deposit Guarantee Scheme Reimburses a Limited Amount to Compensate Account Holders Whose Bank in Croatia Has Failed

Croatia is a country in South-East Europe and one of the member states of the European Union. Its developing high-income service based economy accounts for more than half of its GDP. The financial industry contains local banks and international credit institutions and accommodates this substantial service sector. The industry is subject to several vulnerabilities but remains profitable, liquid and well-capitalized. Consolidation and de-risking resulted in the recent winding up and dissolution of five credit institutions.

Lawmakers in Croatia seek to protect and maintain confidence in the local financial system. The structure of the regulatory framework protects financial institutions, citizens and the economy while providing support to credit institutions in stable and long-term business operations assurance. Detailed information on bank deposit protection in Croatia is available here.

Deposit Guarantee Scheme (Croatia): The Hrvatska Agencija za Osiguranje Depozita (HAOD) is the Croatian State Agency for Deposit Insurance and Bank Resolution. The agency takes an active part in the recovery of credit institutions in distress. It supports account holders of CNB licensed credit institutions and its branches in other EU member states by protecting their deposits up to the secured deposit limit in the event of bankruptcy of the credit institution. The scheme thus enables eligible creditors to quickly and effortlessly receive repayment of their insured account balance.

Secured Deposit Limit: 100.000 euro per depositor per credit institution, paid in Croatian Kuna.

Claim Eligibility: In general, account balances held by individuals, corporations and non-profit organizations at licensed and supervised credit institutions in Croatia are protected up to the secured deposit limit.

Exclusions: Not all deposits and account holders are eligible for deposit compensation when a bank in Croatia fails. Following the EU directive on deposit guarantee schemes (2014/49/EU), the HAOD does not reimburse deposits held by financial institutions. This broad term includes any business or organization that engages in financial transaction for a profit and is able to take appropriate means to protect their investment against losses. Also excluded from DGS coverage are debt securities and other liabilities, deposits whose owner was not identified, deposits made after the closure of the credit institutions and dormant accounts or other accounts where no transaction was made during the 24 months prior to the failure of the credit institution.

Claim Filing Procedures: A decision of inaccessibility of deposits in a supervised credit institution is made by the Croatian National Bank (CNB). The agency then prepares the necessary resources to start the repayment process. It obtains the exact data per account holder and deposit from the credit institution. An invitation is made to the creditors of the bank. The exact procedures are determined on a case by case basis but in general the following is taken into account:

  • Claims must be submitted in person by the account holder;
  • A local credit institution is assigned as a ‘servicing institution’ to verify eligibility and repay the insured deposit;
  • A compensation request must be submitted by the claimant;
  • When the claim is approved, repayment of the insured account balance is done immediately;
  • The timeframe to submit a claim is limited to 36 months after the CNB determines inaccessibility of deposits.

Repayment Conditions: Repayment of the insured account balance take place within 10 business days. Natural persons can choose to be reimbursed in cash or by bank transfer to another licensed credit institution in Croatia.

DGS Claim Rejections and Other Challenges: Bank deposits in Croatia are insured for eligible account holders. Most insured deposits are reimbursed promptly. However, verification procedures of some may trigger a claim rejection. Claimants must submit their claim within 36 months after the CNB confirmed the inaccessibility of deposits. Creditors who feel wronged by the agency can either follow the formal complaints procedure of the agency to object against any decision, or take the matter to the civil court in Croatia.

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