Éamon Ó Cuív (Galway West, Fianna Fail)
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92. To ask the Minister for Finance the estimated potential exposure to the State in 2008 arising from the guarantee on deposits up to €10,000, as long as that guarantee existed; and if he will make a statement on the matter. [32735/13]

Éamon Ó Cuív (Galway West, Fianna Fail)
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93. To ask the Minister for Finance the estimated potential exposure to the State in 2008 arising from the guarantee on deposits up to €100,000; and if he will make a statement on the matter. [32736/13]

Michael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 92 and 93 together.

The Deposit Guarantee Scheme covers deposits by individuals in participating credit institutions. All deposit-taking credit institutions in Ireland are required by law to participate in the Deposit Guarantee Scheme. The Deposit Guarantee Scheme operates across the EU so deposits with credit institutions from other EU Member States operating in Ireland were similarly guaranteed in 2008. Coverage levels and the scope of Deposit Guarantee Schemes have been harmonised across the EU since 2009.

In the event of a credit institution being unable to repay deposits, the Central Bank is currently authorized to make compensation payments to eligible depositors to a maximum of €100,000 per person per institution.

The Deposit Guarantee Scheme is funded by a charge on the credit institutions participating in the scheme. The cost of compensation payments is met from the balances in the Deposit Protection Account. In the event of the Deposit Protection Account being insufficient to fund a compensation event, any difference is made up using advances from the Central Bank or the State; the remaining participating institutions are then responsible for the repayment of these advances.

The Deposit Guarantee Scheme initially covered deposits up to €20,000. The coverage level of €20,000 was revised, initially by a statement by the Minister for Finance on 20 September 2008 and subsequently under the Financial Services (Deposit Guarantee Scheme) Act 2009, to increase the coverage to €100,000 per person per institution.

The Central Bank of Ireland advises me that it does not have data on the potential exposure as at 2008. While it had figures on the total deposits held by financial institutions in 2008, it did not have the technical capacity or powers to provide the information in this way. This matter has since been addressed in the Central Bank (Supervision and Enforcement) Bill 2011.

As no compensation events occurred in 2008, it was not necessary to draw down from the Deposit Guarantee Scheme in 2008.