In the example with Jacinta, who invested €80,000 in a deposit tracker bond, what amount is covered by the Deposit Guarantee Scheme?

• A. €80,000
• B. Nil.
• C. €76,000
• D. €20,000

Answer: (A)

Think of the Deposit Guarantee Scheme as a safety net for ordinary bank deposits up to a fixed limit per bank per depositor. The limit in this context is €100,000. A deposit tracker bond is treated as a deposit by the scheme, so the €80,000 Jacinta invested is covered in full because it sits below the €100,000 cap. If the amount exceeded the cap, only the portion up to €100,000 would be guaranteed. Coverage is per bank, so spreading funds across different banks would apply the cap to each bank separately.