Grounds for execution of guarantees
The Fund will reimburse secured amounts of deposits, with a charge to the deposit guarantee compartment, in the following circumstances:
- When an institution has been declared insolvent or a request has been filed through the courts for insolvency.
- When an institution has not been declared insolvent as per the previous paragraph but deposits past-due and callable on demand have not been reimbursed, and the Bank of Spain decides that, in its opinion and for reasons directly associated with the institution's financial position, the institution is unable to repay the deposits and there are no indications that it will be able to do so in the immediate future. After hearing the Fund's Management Committee, the Bank of Spain must decide on the case as soon as possible and, within five working days from first confirming that the institution has been unable to reimburse the deposits past-due and callable on demand, having given the institution an opportunity to be heard, without the aforementioned deadline being breached.