Document Type

Case Study

Case Series

Credit Guarantee Programs

JEL Codes

G01, G28


As fallout from the global financial crisis intensified in October 2008, governments around the world sought to implement stabilization measures in order to calm and protect their domestic markets. While not directly exposed to the subprime mortgage crisis, the Kingdom of the Netherlands announced the creation of the Dutch Credit Guarantee Scheme (the Guarantee Scheme) on October 13, 2008, to boost confidence in interbank lending markets and to ensure the flow of credit to Dutch households and companies. In establishing this program, the Dutch State Treasury Agency of the Ministry of Finance (DSTA) committed €200 billion to support the issuance of debt to be guaranteed by the government. Dutch financial institutions meeting liquidity and solvency requirements enforced by De Nederlandsche Bank, including foreign subsidiaries established in the Netherlands with substantial business in the country, were eligible to apply for coverage under the Guarantee Scheme. Initially, only newly issued “plain vanilla” commercial paper, certificates of deposit, and fixed- or floating-rate medium-term notes with maturities of between three months and three years could be guaranteed. Additionally, debt instruments would need to be denominated in euros, US dollars, or pounds sterling. Between October 23, 2008, and December 1, 2009, the Guarantee Scheme was utilized by six Dutch financial institutions for a total utilization of €54.2 billion. No guaranteed debt was issued after December 1, 2009. The issuance window, though originally set to expire December 31, 2009, was extended twice, to December 31, 2010. No institutions defaulted on any guaranteed debt.

Date Revised