How safe is my money in a Norwegian bank?
The struggles of several banks have sent shockwaves throughout the markets. What protection is there for your money if your bank goes bust? We had a look at the Norwegian rules.
The collapses of Silicon Valley Bank and Signature Bank in the US, as well as the near-collapse of Credit Suisse in Switzerland, have sent shockwaves through the global market and sparked fears of an impending financial crisis.
All this volatility in the financial industry has gotten people to (rightfully) wonder whether Norwegian banks - and people's money in Norway - were safe.
Is there any cause for concern?
The Norwegian Banks' Guarantee Fund and the deposit guarantee
For most people – at least those with deposits up to 2 million kroner – the short answer is that their deposits are safe.
In Norway, under the Financial Institutions Act, if your bank deposit becomes unavailable, and the situation is due to the bank's actions or adverse situation related to a bank that is a member of the Norwegian Banks' Guarantee Fund, you will be reimbursed the guaranteed deposits within seven working days. Examples of such situations include a bank losing your money or not being able to service its debts.
This "deposit guarantee" covers all deposits up to 2 million kroner (including accrued interests) per depositor, per member bank – and it covers deposits in Norwegian and foreign currency.
Joint account holders are therefore covered for two million kroner each as they are each considered a separate depositor, despite there being just one account.
There's a handy way of protecting your deposit if you have over 2 million kroner in a bank. Take the excess over 2 million, and move it into an account in another member bank (remember that the guarantee is per depositor, per bank).
Note that the guarantee only applies to cash deposits, not investments in various financial instruments.
As of March 2023, there were 120 Norwegian Banks' Guarantee Fund member banks – virtually all banks in Norway are members. However, membership in the fund is optional for branches of foreign banks.
You can find the full list of members here.
Who is covered by the guarantee?
Note that the guarantee does not discriminate between private persons and legal entities. It covers private individuals, companies, organisations, and NGOs. Foreign nationals are included in those who are covered.
Some exceptions apply, but these mostly involve deposits from the public sector and other financial institutions.
Furthermore, the fund guarantees deposits from both Norwegian and foreign nationals and companies. If your deposit is located in a Norwegian bank operating abroad, the guaranteed amount will be capped at 100,000 euros.
Can more than 2 million kroner be covered?
In some cases more than 2 million kroner can be recovered if the money is linked to a "special life event". These will need to have occurred within the previous 12 months, but can cover an unlimited amount.
Examples of these special life events are: sale of residential and leisure property, marriage, breakup, termination of employment, disability, inheritance, insurance payments and compensation for damage caused by criminal acts and wrongful prosecution.
When you apply to have the money recovered, you will need to submit proof and paperwork of why you had (to use Norwegian banking jargon) a "temporarily high deposit" at the time. The documents required and requested will depend on the case. You can find examples here.
Payout deadline
Generally speaking, the guarantee fund tries to pay out the funds as soon as possible, but the deadline is set at seven working days after the authorities intervene, for example, in the case of the liquidation of a bank.
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The collapses of Silicon Valley Bank and Signature Bank in the US, as well as the near-collapse of Credit Suisse in Switzerland, have sent shockwaves through the global market and sparked fears of an impending financial crisis.
All this volatility in the financial industry has gotten people to (rightfully) wonder whether Norwegian banks - and people's money in Norway - were safe.
Is there any cause for concern?
The Norwegian Banks' Guarantee Fund and the deposit guarantee
For most people – at least those with deposits up to 2 million kroner – the short answer is that their deposits are safe.
In Norway, under the Financial Institutions Act, if your bank deposit becomes unavailable, and the situation is due to the bank's actions or adverse situation related to a bank that is a member of the Norwegian Banks' Guarantee Fund, you will be reimbursed the guaranteed deposits within seven working days. Examples of such situations include a bank losing your money or not being able to service its debts.
This "deposit guarantee" covers all deposits up to 2 million kroner (including accrued interests) per depositor, per member bank – and it covers deposits in Norwegian and foreign currency.
Joint account holders are therefore covered for two million kroner each as they are each considered a separate depositor, despite there being just one account.
There's a handy way of protecting your deposit if you have over 2 million kroner in a bank. Take the excess over 2 million, and move it into an account in another member bank (remember that the guarantee is per depositor, per bank).
Note that the guarantee only applies to cash deposits, not investments in various financial instruments.
As of March 2023, there were 120 Norwegian Banks' Guarantee Fund member banks – virtually all banks in Norway are members. However, membership in the fund is optional for branches of foreign banks.
You can find the full list of members here.
Who is covered by the guarantee?
Note that the guarantee does not discriminate between private persons and legal entities. It covers private individuals, companies, organisations, and NGOs. Foreign nationals are included in those who are covered.
Some exceptions apply, but these mostly involve deposits from the public sector and other financial institutions.
Furthermore, the fund guarantees deposits from both Norwegian and foreign nationals and companies. If your deposit is located in a Norwegian bank operating abroad, the guaranteed amount will be capped at 100,000 euros.
Can more than 2 million kroner be covered?
In some cases more than 2 million kroner can be recovered if the money is linked to a "special life event". These will need to have occurred within the previous 12 months, but can cover an unlimited amount.
Examples of these special life events are: sale of residential and leisure property, marriage, breakup, termination of employment, disability, inheritance, insurance payments and compensation for damage caused by criminal acts and wrongful prosecution.
When you apply to have the money recovered, you will need to submit proof and paperwork of why you had (to use Norwegian banking jargon) a "temporarily high deposit" at the time. The documents required and requested will depend on the case. You can find examples here.
Payout deadline
Generally speaking, the guarantee fund tries to pay out the funds as soon as possible, but the deadline is set at seven working days after the authorities intervene, for example, in the case of the liquidation of a bank.
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