Question re "Temporary High Deposit" protection

[euroDilbert]

I am in the process of moving home - but expect a gap where I will be depositing the sale proceeds.
As this is likely to exceed the €100k protection limit, I assume the "temporary high deposit" protection should apply for 6 months.

(1) It seems clear that this applies to Irish banks, will it also apply to EU banks via the likes of Raisin etc. ?
(2) Is interest usually paid on the amount over €100k - as most of them seem to quote up to €100k only ?

 

[ClubMan]

Isn't the temporary high deposit protection part of the Deposit Guarantee Scheme so any bank participating in the DGS presumably also offers the temporary high deposit protection?

Calculation of Compensation

www.depositguarantee.ie

Whether or not a particular bank/product pays interest over €100K depends on the terms and conditions of the particular product.

 

[Freelance]

There are three prerequisites in order for the DGS to apply:

• Are you a protected depositor ?
• Is your's a protected deposit ?
• Is the deposit taker a covered institution ?

Assuming that the answer to all three of these questions is yes, the next step is to determine whether the "tepmorary high balance provisions apply. There are as follows: (extracted from this document)

Without limitation to paragraph (1) and subject to paragraph (3), certain deposits specified in paragraph (4) are protected above the coverage level men- tioned in paragraph (1) (in this Regulation referred to as a “temporary high balance”) up to a limit of €1 million for 6 months after that amount has been credited or from the moment when such deposits become legally transferable.

and paragraph 4:

(4) In order to qualify as a temporary high balance, a part of an eligible deposit in excess of the coverage limit provided for in paragraph (1) must meet at least one of the following criteria:
(a) it comprises—
(i) monies deposited in preparation for the purchase of a private resi- dential property (or an interest in a private residential property) by the depositor,
(ii) monies which represent the proceeds of sale of a private residen- tial property (or an interest in a private residential property) of the depositor, or
(iii) monies which represent the proceeds of an equity release by the depositor in a private residential property;
(b) it comprises sums paid to the depositor in respect of— (i) benefits payable under an insurance policy,
(ii) a claim for compensation for personal (including criminal) injury, (iii) State benefits paid in respect of a disability or incapacity,
(iv) a claim for compensation for wrongful conviction,
(v) a claim for compensation for unfair dismissal, (vi) redundancy (whether voluntary or compulsory),
(vii) the depositor’s marriage, judicial separation or civil partnership,
(viii) the depositor’s divorce or dissolution of his or her civil partner- ship, or
(ix) benefits payable on retirement;
(c) it comprises sums paid to the depositor in respect of—
(i) benefits payable on death,
(ii) a claim for compensation in respect of a person’s death, or
(iii) a legacy or other distribution from the estate of a deceased person;
or
(d) it is held in an account on behalf of a depositor in his or her capacity as personal representative of a deceased person for the purpose of realising and administering the deceased’s estate;

It's not possible to answer these questions for you on the basis of the limited information you have provided, so you might read through them and satisfy yourself that the cover will apply.

Regarding the deposit guarantee schemes applying to banks based in other countries, the schemes vary from country to country. You would need to check the specific scheme applying to any bank or banks you are considering to determine what cover if any it affords for temporary high balances. Note that Raisin has used non-EU banks in the past.

Regarding the interest rates on offer these vary from institution to institution. This applies in Ireland and to the deposits offered by Raisin. There are many accounts that offer interest on deposits in excess of €100,000. You need to check the specific bank/product you are looking at.

 

[Dr Strangelove]

(1) It seems clear that this applies to Irish banks, will it also apply to EU banks via the likes of Raisin etc. ?

Check the DGS in the member state where the deposit provider is covered.

€100k is universal across the EU but things like temporary high balances can vary a bit from country to country.

Remember what matters is the DGS in the country where the deposit provider is, not where you reside.

 

[euroDilbert]

Thanks all for the replies.
Clearly, I will have to check any potential deposit based on the specific details of Country/Deposit Institution.