---
title: "Focus on Credit: Large European banks - General Depositor Preference Takes Shape"
url: https://www.helaba.com/en/focus-credit-large-european-banks-general-depositor-preference-takes-shape
type: dd_research
language: en
updated: 2026-09-28
keywords: Credit, Credit Special
---

# Focus on Credit: Large European banks - General Depositor Preference Takes Shape

Focus on: Credit 26 November 2025 © Helaba | Research & Advisory | 26 November 2025 1 of 3 Research & Advisory Large European banks: General depositor preference takes shape The EU institutions have made further progress in introducing general depositor preference throughout Europe. Draft amendments to the legal texts have recently been made available. However, it will take by mid-2028 for the new regulations to be implemented in the individual Member States. This gives issuers sufficient time to take the new liability cascade into account in their issuance plans. Drafts of amended legal texts are available Back in June 2025, the European Parliament and the Council of the European Union agreed to structure the EU framework for bank crisis management introduced after the financial crisis with a gen- eral 'depositor preference'. This means that customer deposits across the EU will generally have a higher priority in terms of liability ranking than other liabilities such as unsecured liabilities. On 7 November 2025, the European Parliament published a corresponding agreement with the Council. It contains the final drafts of the legal amend- ments to the relevant directives and regulations (Bank Recovery and Resolution Directive, SRMR and Deposit Guarantee Schemes Directive). Trilogue negotiations concluded This was preceded by the usual legislative process within the EU institutions. Back in April 2024, the European Commission had presented an initial legislative proposal to amend the framework for crisis prevention and crisis management for banks. In June 2024, the Council of the EU agreed on a common position on the revision of the crisis management and deposit insurance framework (CMDI) for banks (see our publication Revision to insol- vency ranking of preferred bonds dated 2 July 2024). Revised liability cascade: Negative credit impact for senior preferred bonds limited Conversely, giving customer deposits a higher ranking in terms of liability means that bondholders, who were pre- viously on an equal footing, are now at a disadvantage. Until now, Member States have been free to decide whether customer deposits not covered by deposit guarantee schemes should be ranked on a par with senior lia- bilities. In some EU countries, including Germany, customer deposits are not currently given a higher ranking. In Germany, the introduction of general depositor preference will mean that corporate deposits over EUR 100,000 will move up one level in the liability hierarchy in future, ranking ahead of senior preferred bonds. This means that the liability pool within the senior preferred bond category will decrease. This will have a negative impact on their credit rating if no countermeasures are taken. Dr Susanne Knips Senior Credit Analyst t 069/91 32-32 11 Focus on: Credit © Helaba | Research & Advisory | 26 November 2025 2 of 3 In our opinion, however, the negative impact on the credit ratings of the preferred bonds of most banks active on the capital market will be limited. These institutions have high risk buffers in the form of equity capital and non- preferred bonds. In addition to the quality of assets, the funding strategy and the MREL ratio are particularly im- portant for the assessment of individual institutions. As a countermeasure, the banks affected could also issue additional preferred bonds in order to increase the liabil- ity base again. We therefore assume that some banks will issue additional preferred bonds. Timetable: Implementation in member states by mid-2028 The agreement now awaits formal confirmation by the EU Council. We expect the legislative process to be com- pleted and the agreement to be published in the EU Official Journal in the first half of 2026. According to the agreement now in place, the individual Member States will then have two years to implement the changes at national level. At least this will bring about further standardisation of liability cascades in Europe. Current hierarchy of claims in Germany\* Rising seniority, from lowest (bottom) to highest (top) \* identical in AT, BE, CZ, DE, DK, EE, ES, FI, FR, IE, LV, LT, LU, MT, NL, PL, RO, SE, SK Customer deposits ranked above senior preferred bonds in BG, CY, EL, HR, HU, IT, PT, SI Source: Helaba Research & Advisory Covered deposits pursuant to Deposit Guarantee Scheme (up to EUR 100,000) Deposits from private and SME customers > EUR 100,000 Senior preferred Other deposits > EUR 100,000 Derivatives Senior non-preferred Tier 2 AT 1 CET 1 Hierarchy of claims Liability cascade in Germany revised in accordance with draft legislation from the European Parliament Rising seniority, from lowest (bottom) to highest (top) Source: Helaba Research & Advisory Covered deposits pursuant to Deposit Guarantee Scheme (up to EUR 100,000) Deposits from private and SME customers > EUR 100,000 Other deposits (large corporates, institutionals, interbank) > EUR 100,000 Derivatives Senior preferred Senior non-preferred Tier 2 AT 1 CET 1 Hierarchy of claims Focus on: Credit © Helaba | Research & Advisory | 26 November 2025 3 of 3 Publications from the "Focus on: Credit" series → EUR Corporate Bonds: Primary Market Q3 2025 → EUR Benchmark Bank Bonds: Primary Market Q3 2025 → EBA clarifies risk weighting of Senior Preferred bonds → German banks – lower capital requirements for residential mortgages Publisher and editor Helaba Research & Advisory Editor: Stefan Rausch Corporate Research & Advisory Publisher: Dr Gertrud Rosa Traud Chief Economist/ Head of Research & Advisory Neue Mainzer Str. 52-58 60311 Frankfurt am Main Germany T +49 69 / 91 32 – 20 24 Internet: www.helaba.com Disclaimer This publication was very carefully researched and prepared. However, it contains analyses and forecasts regarding current and future market conditions that are for informational purposes only. The data are based on sources that we consider reliable, though we cannot assume any responsibility for the sources being accurate, complete, and up to date. All statements in this publication are for informational purposes. They must not be taken as an offer or recommenda- tion for investment decisions. Sign up for our newsletter here: https://news.helaba.de/research/

General depositor preference is being introduced across Europe. Draft amendments to the legal texts are now available. We expect the impact on the creditworthiness of preferred bonds to be minor.