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<p>The Deposit Guarantee Scheme Directive (DGSD) updates existing EU legislation designed
to harmonise the level of deposit protection provided across the European Economic
Area (EEA).</p><p> </p><p> </p><p> </p><p>This is necessary to ensure that depositors
are entitled to the same level of protection wherever they deposit their money, and
that UK firms are not competitively disadvantaged in relation to firms in other EEA
jurisdictions.</p><p> </p><p> </p><p> </p><p>As a result of the current strength of
the pound in relation to the euro, it has been necessary for the Prudential Regulation
Authority to review the sterling coverage limit. However, the Government has taken
action to ensure that UK depositors are not exposed to a sudden reduction in the level
of protection they receive.</p><p> </p><p>HM Treasury has laid a statutory instrument
to ensure that depositors who are currently entitled to £85,000 of protection from
the Financial Services Compensation Scheme will continue to be until 31 December 2015.</p><p>
</p><p> </p><p> </p><p>This will ensure that there is sufficient time available for
depositors to be made aware of the changes, and to take such steps as they feel necessary
to manage their financial affairs appropriately in light of this change.</p><p> </p><p>
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