Dutch insurers continue to invest less in bonds
Insurers in the Netherlands continued to sell direct investments in bonds in 2023, new figures from DNB show. For the fourth year in a row, insurers sold more bonds than they bought.
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The Financial Supervision Act (Wet op het financieel toezicht) provides that it is not permitted to operate as a bank or electronic money institution without having obtained authorisation. In addition, the Act provides for a prohibition against inviting repayable funds.
The prohibition to invite repayable funds does not apply to
In addition, the prohibition does not apply to those who have been exempted under the Exemption Regulation under the Wft (Vrijstellingsregeling Wft) or to those who have been granted dispensation by DNB under Section 3:5(4) of the Wft. We may grant dispensation if the applicant demonstrates that the interests which the prohibition aims to protect are sufficiently safeguarded.
The prohibition is based on Article 9(1) of the Capital Requirements Directive IV (Directive 2013/36/EU), which stipulates that “Member States shall prohibit persons or undertakings that are not credit institutions from carrying out the business of taking deposits or other repayable funds from the public”.
Section 1:1 of the Wft defines "repayable funds" as funds that must be repaid at a certain point in time, for any reason whatsoever, and of which it is clear in advance what nominal amount must be repaid. This includes deposits and other repayable funds.
Funds are considered repayable if it is clear in advance what amount must be repaid. Both the nominal amount and the fact that it must be repaid must be established.
According to the Explanatory Memorandum to the Wft the following categories of funds must not be considered repayable funds:
If you need to know whether the prohibition to invite deposits and other repayable funds also applies to your current or proposed activities, you can submit a request for a scope assessment. Please provide a substantiated legal analysis of your current or proposed activities. Your conclusion must be based on the Financial Supervision Act (Wet op het financieel toezicht – Wft). Send your analysis to our Expert Centre on Market Access at markttoegang@dnb.nl. As a rule, we will respond within four weeks, but we may need some more time to assess complex cases.
[1] See the (first) Memorandum of Alterations of the Wft, Parliamentary papers II 2004/05, p. 229-230 (in Dutch only).
Insurers in the Netherlands continued to sell direct investments in bonds in 2023, new figures from DNB show. For the fourth year in a row, insurers sold more bonds than they bought.
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