Bank Resolution Fund
Banka Slovenije established a separate national bank resolution fund in 2015 on the basis of the Bank Resolution Authority and Fund Act (ZOSRB).
Under Article 62 of the new Resolution and Compulsory Winding-Up of Banks Act (ZRPPB-1B), the old bank resolution fund is continuing operations as the Bank Liquidation Fund, while the founding assets paid into the bank resolution fund are now considered contributions to the bank liquidation fund.
Bank Liquidation Fund
The fund is financed by contributions from banks and savings banks established in Slovenia. The fund’s assets may be used for financing the implementation of involuntary liquidation measures imposed by Banka Slovenije for:
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the contribution of the initial capital of the asset management vehicle established in accordance with Article 212 of the Resolution and Compulsory Winding-Up of Banks Act (ZRPPB-1B) when the net value of the bank’s assets that are being transferred is higher or equal to the net value of the bank’s liabilities that are being transferred to the asset management vehicle by applying the asset separation tool;
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the payment of consideration to the bank when the fund, as the acquirer, is taking over the assets, rights and obligations of a bank undergoing involuntary liquidation proceedings by applying the sale of business tool;
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loans, guarantees, sureties or other collateral provided in connection with involuntary liquidation measures;
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loans to the Deposit Guarantee Fund established on the basis of the Deposit Guarantee Scheme Act for the purposes of providing liquidity for the payment of covered deposits.
The target level of the fund’s assets, which are assets of the banks and are managed separately from other assets at Banka Slovenije, is 3.0% of total covered deposits in Slovenia as at 30 September 2014. The banks provided founding assets in the amount of 1.3% of total covered deposits via founding cash contributions, and are also required to be capable of providing cash in the amount of 1.7% of covered deposits to the fund at any time. Accordingly they are required to structure liquid assets in the form and in the manner set out by the Regulation on liquid assets for the purpose of the resolution fund.
Investment policy and management fees
Banka Slovenije sets the bank liquidation fund’s investment policy to ensure the security, low risk and high liquidity of the fund’s assets. The Governing Board of Banka Slovenije set out the bank liquidation fund’s investment policy and the package of management fees to be covered by Banka Slovenije in accordance with the ZRPPB-1 and charged against the fund’s assets via the Regulation on the investment policy and management fees of the bank liquidation fund. Since 1 January 2019 Banka Slovenije has managed the fund’s assets in a joint fund together with the assets of the deposits guarantee fund.
By law, the bank liquidation fund will cease its operations on 31 December 2030.