Protect yourself against the new bank
“Bail-in directive” deal

Europe took measures to avoid that governments bail-out struggling banks. Although the general media did not pay much attention to this, the deal was decided in January 2015 and went into effect on the 1st of January 2016.

What does it mean?

Basically, bank –shareholders, -creditors, –bond holders and unsecured depositors (over € 100.000,-) will be the ones to bear the losses on rainy days. Not taxpayers (which is the case in a government bail-out). Cyprus already used this method back in 2013.


During the financial crisis of 2008, taxpayers and governments spent billions to rescue banks in distress. Resulting in high risk gambles and setting governments with even higher debts. The “bail-in” method will avoid this in the future.

Risks involved?

Unfortunately, yes…
Although holders of bank shares/bonds know there is a risk of losing the investment (bail-in = confiscating), the account holders with more than € 100.000,- don’t.

But it is even worse…

A fund will be established through bank contributions for each European country, and by 2025 (!) the funds should reach 1% of the covered deposits (below € 100.000,-) of all banks of that country.
According to art. 384/1 §4 these funds cannot intervene for more than 50% of their total value!

It remains to be seen what happens if a major bank collapses before 2025 and even then the question will be whether half of 1% of all covered deposits will be enough to safeguard deposits below € 100.000,- …
Imagine your hard earned money being taken away because your bank is in trouble, a nightmare!

What to do?

People secure their computer with an Antivirus, so why not securing your wealth?

To start with, spread your savings over several financial institutions.
You will lower the risk, but don’t count on gains with current interest rates

If you have experience with the stock market, you could consider investing a sound proportion of your savings in stocks. The stock markets have been very volatile and there always is risk involved. If you don’t have this in your fingers, be very careful with this option!

One of the safest options (if not the safest) to secure your savings, still is investing in real estate. This is a stabile investment with a possibility to generate rental income.