Funding and Finance
Funding
The Fund for Orderly Bank Restructuring has mixed funding, 9 billion Euros, from the General State Budgets and from the contributions of the Deposit Guarantee Fund:
- The amount of funding charged to the General State Budgets is 6.75 billion Euros and the contribution from the Deposit Guarantee Fund is 2.25 billion Euros.
Finance
- In order to meet its objectives, the Fund for Orderly Bank Restructuring may secure funding on the securities markets by issuing fixed income securities, receive loans, apply to open credit facilities and undertake other borrowing transactions.
Outside resources obtained by the Fund for Orderly Bank Restructuring, whatever their form of instrumentation, may not exceed the sum of 3 times the funding available at any time. However, after January 1, 2010, the Minister for the Economy may give authority for this limit to be exceeded; nevertheless, outside funding for the Fund for Orderly Bank Restructuring may never exceed 10 times its funding. - Unassigned property of the Fund must be materialized into public debt or into other high liquidity, low risk assets.
- Under Article 114 of General Budget Law 47/2003, of 26 November, the General State Administration is authorised to issue guarantees to secure the economic obligations enforceable against the Fund for Orderly Bank Restructuring, derived from issues of financial instruments, agreements for loan and credit transactions and realisation of any other borrowing transactions made by this Fund.
- Issuance of guarantees which will not earn any commission, must be agreed by the Minister for the Economy, in accordance with the provisions of General State Budget Law 47/2003, of 26 November.
- Issuance of guarantees, limits:
- In 2009, the General State administration provided guarantees for a maxium sum of 27 billion Euros.
- For subsequent financial periods, the maximum amounts for the issuance of guarantees will be as determined by the corresponding General State Budget Laws
.