The Spaniards save 1.11 trillion in the bank: 41.1 billion more than a year ago

To modify the regulations on bank deposits in Spain, the specific parliamentary procedures depend on the rank of the norm to be changed and the route chosen by the Government or the Cortes. Broadly speaking, three scenarios can be distinguished: reform through an ordinary law, through a royal decree-law, and through modification of regulations approved by the Government.

1. Modification through an ordinary law

The basic regulation of bank deposits is usually found in laws (e.g., banking regulation, consumer protection, etc.). To modify them by ordinary means, the common legislative procedure would be followed:

• Initiative: it can be a bill (initiated by the Government) or a private member's bill (initiated by parliamentary groups, regional parliaments, popular initiative, etc.). If it concerns technical issues of the financial system, it is usually a government bill.
• Qualification and consideration: the Board of the Congress admits the initiative and, in the case of private member's bills, the Plenary decides, by simple majority, whether to take it into consideration.
• Amendment phase: groups and deputies can submit total amendments (to return the text or propose an alternative one) and article-by-article amendments. If a total amendment with an alternative text is approved, that text is processed instead of the original.
• Committee and Subcommittee: a competent committee (for example, Economic Affairs) appoints a subcommittee that prepares a report integrating or rejecting amendments. Then, the committee debates that report, may vote on new amendments, and approves a report.
• Debate and vote in the Plenary of the Congress: the Plenary discusses the report and reserved amendments. Finally, it votes on the entire bill. As it is an ordinary law, a simple majority (more yes than no votes) is sufficient.
• Referral to the Senate: the Senate can approve the text, veto it, or propose amendments. If it vetoes, the Congress can override the veto:
  • by absolute majority in a first vote, or
  • by simple majority after two months.
  If the Senate introduces amendments, the Congress decides whether to accept them or not. It can reject them by simple majority; in that case, the text initially approved by the Congress prevails.
• Sanction, promulgation, and publication: once the law is approved, it is sent to the King for sanction and published in the Official State Gazette (BOE). From then on, it comes into force on the date established.

Urgent processing and single reading

To shorten deadlines, the Government or the Plenary of the Congress can agree on urgent processing, which halves many deadlines for amendments and actions in both Chambers. If the matter is relatively simple or very technical and there is high consensus, the Plenary can decide on the single reading procedure, which concentrates the debate and vote in a single plenary procedure, without subcommittee or committee (or with a very abbreviated step).

2. Modification through royal decree-law

When the Government considers there is an extraordinary and urgent need (e.g., risk to financial stability), it can modify aspects of the deposit regulations through a royal decree-law. The procedure is different:

• The Government approves the royal decree-law in the Council of Ministers and it comes into force after its immediate publication in the BOE.
• It must submit it to the Congress for ratification or repeal within a maximum period of 30 days. The Plenary debates and votes: with a simple majority it can ratify or repeal it.
• In the same act, the Congress can agree to process it as a bill by the urgent procedure, which opens a process similar to that described in the previous section to introduce changes to the text through amendments.

The decree-law allows for a rapid reform, but essential control remains with the Congress within that 30-day period.

3. If what is modified is a Government regulation

Part of the regulations on bank deposits are developed in regulations (royal decrees, ministerial orders) issued by the Government or the Ministry of Economy. Their modification:

• Does not require a full legislative procedure in the Cortes, but a new regulation approved by the Council of Ministers (or by the competent minister).
• May be subject to public consultation and hearing procedures, as well as mandatory reports (Council of State, Bank of Spain, CNMC, etc.), but this occurs within the governmental sphere, not parliamentary.
• Parliament can influence indirectly: through questions, interpellations, non-legislative motions or even by changing the enabling law to condition the regulatory content.

In summary, for a deep and stable reform of the bank deposit regulations, the ordinary law is usually used (with the full Congress–Senate–sanction cycle), while the royal decree-law is an exceptional and urgent mechanism, and government regulations are modified without direct parliamentary procedure, although always within the limits set by law.

The Bank of Spain is the national supervisory authority of the Spanish banking system and, within the Single Supervisory Mechanism (SSM) of the euro area, shares functions with the European Central Bank (ECB). Regarding bank deposits, its role focuses on ensuring the soundness of the entities receiving them, the stability of the financial system, and the adequate protection of depositors, although it does not directly manage clients' funds nor is it ultimately responsible for returning deposits (this corresponds to the entities themselves and, in extreme cases, to the Deposit Guarantee Fund).

Prudential supervision of entities that take deposits

The essential function of the Bank of Spain regarding deposits is the prudential supervision of credit institutions (banks, savings banks, credit cooperatives, branches of foreign entities) authorized to take funds from the public. This supervision includes:

• Monitoring solvency and liquidity: it verifies that entities maintain adequate levels of capital, provisions, and liquidity buffers to face deposit withdrawals and possible losses.
• Risk control: it analyzes how they manage credit risk, market risk, interest rate risk, liquidity risk, and operational risk, which may affect the entity's ability to return deposits.
• Continuous monitoring: through on-site inspections, periodic information requests, and early warning systems, it detects deteriorating situations that may endanger deposits.
• Corrective measures: it can require capitalization plans, limit certain operations, impose restrictions on dividend distribution, or require management changes when it perceives risks to stability or depositors.

Authorization and registration of entities that take deposits

Another key competence is participation in the processes of authorization, modification, and revocation of entities that can take deposits. Without valid authorization and registration in the Bank of Spain's records, an entity cannot legally offer deposit products to the public.

In this area, the Bank of Spain:

• Informs and participates in decisions on banking licenses, mergers, acquisitions, and changes of control.
• Verifies that new entity projects present a viable business model and an adequate governance structure to protect clients' funds.
• Can propose revocation of authorization when the entity incurs serious breaches that put deposits at risk.

Transparency, conduct, and protection of depositors

Although direct consumer protection also falls under other rules and institutions, the Bank of Spain has relevant functions regarding transparency and good practices in deposit products:

• It issues circulars and guides on pre-contractual information, conditions of checking and savings accounts, term deposits, and other similar products.
• It supervises that advertising and contractual documentation of deposits are clear, not misleading, and adequately reflect risks, fees, and remuneration.
• It manages a complaints service where clients can raise conflicts with supervised entities about deposits and other banking services, issuing reasoned reports that, although not always binding, carry strong supervisory weight.

Relationship with the Deposit Guarantee Fund

The Deposit Guarantee Fund (DGF) is the mechanism that insures deposits up to a certain limit per holder and entity in case of insolvency. The Bank of Spain is not the DGF, but:

• It supervises the information that entities provide about DGF coverage to their clients.
• It cooperates with the DGF in crisis situations, providing analysis on the situation of entities and possible resolution or liquidation measures.
• It can activate or propose resolution or intervention actions when it detects a serious risk to depositors.

Contribution to financial stability

Finally, the Bank of Spain performs macroprudential analysis and overall financial stability monitoring functions. Through periodic reports, stress tests, and recommendations, it identifies vulnerabilities in the banking sector that may systemically affect deposits and proposes regulatory or supervisory measures to mitigate them.

In sum, deposit protection is mainly articulated through the prudential and conduct supervision exercised by the Bank of Spain over entities, complemented by the guarantee of the Deposit Guarantee Fund and, at the European level, by coordination with the ECB and other SSM authorities.

Deposit protection in Spain is structured through a mixed European and national framework that combines: a mandatory deposit guarantee system, stringent solvency and supervision requirements, and transparency and client information rules. Every bank authorized to operate in Spain must simultaneously comply with these regulatory blocks.

1. Deposit guarantee system and coverage limit

The central pillar is the Deposit Guarantee Fund of Credit Institutions (DGF), mainly regulated by:

• Royal Decree-Law 16/2011, of October 14, which creates the DGF.
• Royal Decree 2606/1996, of December 20, on deposit guarantee funds of credit institutions, deeply amended by Royal Decree 1012/2015, of November 6.
• Transposition of Directive 2014/49/EU, relating to deposit guarantee schemes, through the above regulations.

Key requirements for banks are:

• Mandatory membership of the DGF for all Spanish credit institutions and certain branches of foreign entities taking deposits in Spain.
• Minimum coverage of 100,000 euros per depositor and per entity for eligible deposits; includes cash and interest accrued up to the default event. Specific rules exist for joint deposits and deposits in currencies other than the euro.
• Exclusion of certain professional depositors (other financial entities, insurers, etc.) and certain products, according to the positive/negative delimitation of “guaranteed deposits.”
• Rapid reimbursement: Royal Decree 1012/2015 adapts the payment deadline to the standards of Directive 2014/49/EU, progressively reducing it to a few business days when the Fund must repay guaranteed deposits.
• Risk-based funding of the Fund, according to Bank of Spain Circular 5/2016, which develops the method for contributions from entities to be proportional to their risk profile.

2. Solvency requirements and prudential supervision

Deposit protection is not limited to the DGF: it is mainly based on entities being sound. The prudential framework comes from:

• Law 10/2014, of June 26, on the organization, supervision, and solvency of credit institutions.
• Its regulatory development (Royal Decree 84/2015 and subsequent amendments) and circulars such as Bank of Spain Circular 2/2016 and Circular 3/2022, which complete the adaptation to Regulation (EU) No 575/2013 (CRR) and Directive 2013/36/EU (CRD).

From this block derive obligations such as:

• Maintaining sufficient regulatory capital (capital ratios, buffers, leverage, liquidity) according to CRR/CRD and Law 10/2014.
• Undergoing continuous supervision by the Bank of Spain and the ECB within the Single Supervisory Mechanism, including recovery and resolution plans coordinated with Law 11/2015, on recovery and resolution of credit institutions.
• Reporting detailed financial information to the supervisor according to Bank of Spain Circular 4/2017 (financial statements and other solvency information).
• Cooperating with the DGF and resolution authorities, which can mobilize Fund resources if necessary in an orderly resolution process to protect depositors.

3. Information and transparency towards the depositor

Royal Decree 2606/1996, as amended, requires entities to:

• Inform clients, in all their offices and on their website, which Deposit Guarantee Fund they belong to, with contact details and applicable regulations.
• Use a standardized information sheet about the coverage of the deposit guarantee system (maximum amount, scope, exclusions).
• Clearly explain that the coverage limit applies to the aggregate deposits of each holder in the same entity, even if operating under different commercial brands.
• Explicitly indicate which products or deposits are not guaranteed by the DGF.
• Inform, when requested by the client, about the conditions, deadlines, and formalities for reimbursement in case of guarantee activation.

4. Custody, segregation of funds, and other requirements

The framework is completed with rules on payment services, securities, and other activities in which the bank holds clients' funds or assets:

• Royal Decree-Law 19/2018, on payment services, modifies both Law 11/2015 and Law 10/2014 to strengthen the protection of users' funds in payment services, including their separation from the entity's own assets or adequate coverage through insurance or guarantees.
• Other sectoral regulations (securities market, collective investment institutions, etc.) require depositary and custodian banks to guarantee the return of securities and avoid confusion between own and client assets, complementing the guarantee of cash deposits.

Overall, the obligation to belong to the DGF, the strict solvency requirements and supervision by the Bank of Spain/ECB, together with transparency and fund custody rules, constitute the core legal requirements that Spanish banks must meet to safeguard their retail clients' deposits.