EFDI │ Belgrade 2011

1. EFDI │ Belgrade 2011

2. RiskAdjustedPremiums│ Harmonization ? Business Models / RiskProfiles Environment national Taxation / Laws Accounting Standards Regulations (Basel II/III)

3. RiskAdjustedPremiums│ Funding Contributionlinkedto individual risk  Insurance Approach Fundinglinkedtoportfoliorisk  Insurance Approach and/orstressedtoriskscenarios  bePrepare Approach

4. RiskAdjustedPremiums│ Compensation Liquiditylinkedtoriskprofile bePrepare Approach Organistationlinkedtorisksituation tobePrepare Approach

5. RiskAdjustedPremiums│ Intervention Riskanalysisforearlyinterventionpurposes  Early Warning Approach Individual migrationanalysis  Early Warning Approach

6. RiskAdjustedPremiums│ Harmonization Business Models / RiskProfiles Environment national Taxation / Laws Accounting Standards Regulations (Basel II/III) …

7. RiskAdjustedPremiums│ Harmonization I • Conceptual Framework • Simple: the model needs to be understandable by DGS members. • Accurate: the model should accurately reflect the relative risk that the DGS members pose to the fund (the model should be effective at discriminating banks into appropriate risk categories). • Reasonable: in terms of amount of information required, i.e. the collection of the inputs for the model should avoid unduly burdening DGS members. • Affordable/Sustainable: The model should not cause insolvency to any DGS member, i.e. the costs resulting from the model should be met by the DGS members. • Flexible: the model should be adjustable to different countries, i.e. different economies, different legal structures, different financial markets, different bank types, different business strategies. • Open and Transparent: the DGS should know why they are in a risk class and should be able to verify it. • Impartial: the model should be fair. Banks with similar characteristics should be categorized similarly. • (EFDI Working Group III:Development of Common Voluntary Approaches toincludeRiskBased Elements for DGS“, 2009 , Joint Research Centre)

8. RiskAdjustedPremiums│ Harmonization II Definition of • power of discretion (national/central) • criteria (quantitative/qualitative) • risk oriented weighting system,sensitive thresholds • methods (mathematical/statistical,experts know-how, mix of both) • contribution range (risk coefficient - 75% up to 200%) • number of risk classes (five?) • back testing • validation • stress testing • Consideration of • an adequate level of flexibility (e.g. various business models, • risk profiles, legal and competitive environments, accounting standards, regulatory options) •  European Forum of Deposit Insurers (EFDI) as a qualified platform for further discussion and coordination

9. RiskAdjustedPremiums│ EFDI Belgrade 2011 Thankyouverymuchforyourattention Bernd Bretschneider managingdirector GBB-Rating Gesellschaft für Bonitätsbeurteilung mbH (Credit Rating Agency) Kattenbug 1 D-50667 Cologne Germany Phone: + 49 221 912897 210 Fax: + 49 221 912897 270 E-Mail: b.bretschneider@gbb-rating.de

10. RiskAdjustedPremiums│ EFDI Belgrade 2011 • Bernd Bretschneider • managingdirector • GBB-Rating Gesellschaft für Bonitätsbeurteilung mbH (Credit Rating Agency) • Kattenbug 1 • D-50667 Cologne • Germany • Phone: + 49 221 912897 210 • Fax: + 49 221 912897 270 • E-Mail: b.bretschneider@gbb-rating.de CV Apprenticeship: SGZ-Bank AG (today DZ Bank), Frankfurt, Germany Studies of business administration: Friedrich-Alexander-Universität, Nuremberg, Germany Universität zu Köln, Cologne, Germany Academic Title: Diplom-Kaufmann University of Bradford, Bradford, UK Academic Title: MBA Consultant: OrganisationsforumWirtschaftskongresse.V. (OFW), Cologne, Germany Commerzbank AG: Knowledge based Systems, Frankfurt, Germany Commerzbank AG: Customer Analysis in the German Democratic Republic, Leipzig, Germany Manager Business Clients: Bayerische Hypotheken- und Wechsel-Bank AG (todayUniCredit), Berlin, Germany Analyst/Managing Director:GBB-Rating Gesellschaft für Bonitätsbeurteilung mbH, Cologne, Germany