Funding crisis management

The management of banks and other institutions in crisis shall be funded primarily by using the failing institution’s internal resources in the form of shareholders and creditors incurring losses and, if necessary, also being responsible for recapitalisation. However, in certain circumstances, additional external funding may be required. Even if this funding is obtained from outside the institution in crisis, it is nevertheless the institutions themselves that shall bear responsibility for it. This is achieved through the fees paid by the institutions to the Debt Office and which are gathered in special state-administered funding arrangements. In Sweden, there are three of these:

• the resolution reserve
• the deposit insurance fund
• the stability fund.

Resolution reserve

The resolution reserve can be used to facilitate the implementation of resolution in different ways, such as by temporarily supporting liquidity in institutions that are placed in resolution. It is also possible, in certain circumstances, to use the reserve to cover part of an institution’s losses and any need for recapitalisation. However, this presumes that shareholders and creditors have first borne a considerable part of the burden of losses and recapitalisation.

Annual fees

The institutions pay annual fees to the resolution reserve. The fee shall be paid for as long as the balance at the end of the year that the fee concerns is less than 3 per cent of covered deposits (target level).

The distribution of the fees among the institutions is regulated by a delegated EU regulation. Larger institutions pay a risk-adjusted fee proportionate to their size and risk. Smaller institutions pay a flat-rate fee determined by their size according to a standardised model.

If the reserve balance is not sufficient to fund the actions decided by the Debt Office during resolution, additional funds may be borrowed on behalf of the reserve. In that case, the deficit in the reserve and the loan costs shall be covered by additional fees charged to the institutions retroactively.

The resolution reserve amounted to SEK 68 billion in total at the end of 2024. This represents approximately 2.9 per cent of the sum of the institutions' quarterly average volume of covered deposits in 2023.

The resolution reserve in figures:

• In 2024, 133 institutions paid a resolution fee, and a total of SEK 4.36 billion was paid in.

• 60 institutions paid a risk-adjusted fee, accounting for almost the entirety of the fees withdrawn. The rest of the institutions paid a standard fee.

When does the resolution reserve reach the target level?

Resolution fees are charged until the reserve reaches the target level of 3 per cent of covered deposits. The size of the annual fees charged, and the number of years ahead during which a fee will be charged, depend on the progression of covered deposits and the fee basis of the institutions liable to pay fees, as well as on the interest payable on the balance in the reserve (based on the Riksbank’s policy rate). It is therefore difficult to reliably forecast exactly when the target level will be reached.

The table below shows the growth of the resolution reserve since 2019, both in nominal terms and as a percentage of covered deposits. The Debt Office uses implicit forward rates in the forecasts of the interest paid on the balance of the reserve. The calculation was made using the yield curves on 31 March 2025.

*Forecast, including withdrawals of resolution fee.

The deposit insurance fund

The deposit insurance fund is a funding arrangement for the protection afforded to depositors in the event of a bank or institution being declared bankrupt or placed in resolution. 

As with the resolution reserve, all banks and institutions that are members of the deposit insurance scheme pay an annual fee to the Debt Office. The fees are transferred to the deposit insurance fund. If the balance of the fund is insufficient for paying compensation, additional funds are borrowed to cover the need. Such loans shall be repaid by the subsequent collection of additional fees from institutions.

The value of the deposit insurance fund amounted to SEK 53 billion at the end of 2024.

The stability fund

The stability fund was set up in the context of the global financial crisis of 2008 to finance certain support measures for the financial system. The banks and institutions paid annual fees to the fund until 2016, when the stability fee was replaced by the resolution fee. Part of the stability fund’s assets were then also transferred to the resolution reserve.

The stability fund is still in place to finance measures within the Debt Office’s role as support authority; that is, its mandate to maintain the capability to provide preventive state support through loan guarantees or capital contributions to viable institutions. The stability fund also constitutes a funding arrangement for measures that the Debt Office can take in its role as resolution and support authority for central counterparties.

In the same way as for the resolution reserve and the deposit insurance fund, the Debt Office is able to borrow funds on behalf of the stability fund if the balance of the fund is insufficient for financing the decided support measures. 

The value of the stability fund amounted to approximately SEK 43 billion at the end of 2024.